Document 6488078

Transcription

Document 6488078

“The gold standard in business planning for organizations
addressing social problems.”
— Edward B. Roberts
David Sarnoff Professor, Management of Technology, MIT Sloan School of Management
Founder and Chair, MIT Entrepreneurship Center
Business Planning for
ENDURING
SOCIAL IMPACT
A Social-Entrepreneurial Approach
to Solving Social Problems
Sample
Business Plan
included
by Andrew Wolk & Kelley Kreitz
A
How-to Guide
ABOUT THE AUTHORS
ANDREW WOLK is the founder and CEO of Root
Cause and oversees the organization’s overall strategic
direction. He has consulted to dozens of organizations
working in the fields of civic engagement, economic
development, education, the environment, seniors,
and more. As part of Root Cause’s knowledge sharing focus, Andrew has
also authored a chapter in the Small Business Administration’s annual
report to the president of the United States, titled “Social Entrepreneurship and Government: A New Breed of Entrepreneurs Developing
Solutions to Social Problems” (December 2007). He founded the two
social enterprises that Root Cause leads: InnerCity Entrepreneurs and
the Social Innovation Forum. Andrew is also a senior lecturer in social
entrepreneurship at MIT’s Sloan School of Management and the Department of Urban Studies and Planning.
KELLEY KREITZ developed and launched Root
Cause’s knowledge sharing department in 2006. Previously, she worked for New Profit Inc. on initiatives
aimed at building the field of social entrepreneurship.
She has also advised nonprofits throughout the United States on messaging and media strategy, with a national news service
for nonprofits. As a writer and journalist, Kelley has served as the senior
writer for GreenBiz.com and reported for WRNI, Rhode Island’s NPR
news station, and KPFA in Berkeley, California.
BUSINESS PLANNING for
ENDURING
SOCIAL IMPACT
A Social-Entrepreneurial Approach
to Solving Social Problems
Root Cause
Cambridge, MA
Copyright © 2008 Root Cause
All rights reserved. No part of this publication may be reproduced, stored in a
retrieval system, or transmitted in any form or by any means electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of
the publisher.
Published by
Root Cause
675 Massachusetts Avenue, 9th Floor
Cambridge, MA 02139
Design and Layout
Design Studio at Monitor
Two Canal Park
Cambridge, MA 02141
Library of Congress Catalog Number: 2007943147
International Standard Book Number (ISBN)
paper: 978-0-615-18284-1
Printed in the United States of America
CONTENTS
ACKNOWLEDGMENTS
V
HOW TO
USE THIS GUIDE
VII
INTRODUCTION TO
BUSINESS PLANNING FOR ENDURING SOCIAL IMPACT
The Promise of Business Planning
1
............................................................. 1
What Is a Business Plan for Enduring Social Impact? ......................... 4
What to Consider Before You Start .............................................................. 6
The Business Planning Process ..................................................................10
STEP 1
PLANNING TO PLAN
11
1. Select Your Business Plan Working Group .......................................11
2. Establish a Stakeholder Update Process ...........................................11
3. Create a Work Plan and Approval Dates.............................................12
4. Begin Planning a Road Show ...................................................................13
5. Conduct a Gap Analysis ..............................................................................13
Concluding Step 1 ..............................................................................................14
STEP 2
ARTICULATING A SOCIAL IMPACT MODEL
15
Social Problem Definition ..............................................................................16
Vision of Success ...............................................................................................18
Social and Economic Impact Indicators ...................................................19
Mission ...................................................................................................................20
Operating Model
...............................................................................................20
Social Impact Strategies ................................................................................23
Organizational and Program Performance Indicators ......................24
Feedback Loop ....................................................................................................25
Concluding Step 2 ..............................................................................................26
STEP 3
DEVELOPING AN IMPLEMENTATION STRATEGY
27
PART ONE
Setting a Timeline & Establishing Your Phase One Strategy Goals ..... 27
Business Plan Timeline ..................................................................................27
Phase One Strategy Goals..............................................................................28
PART TWO
Building the Organizational Capacity to Implement Your
Social Impact Strategies ................................................................................... 29
Team and Governance
....................................................................................30
Financial Sustainability ...................................................................................31
Marketing ..............................................................................................................37
Technology ...........................................................................................................41
Public Policy.........................................................................................................42
Performance and Social Impact Measurement ....................................44
Risk Mitigation ....................................................................................................49
Concluding Step 3 ..............................................................................................50
STEP 4
FINALIZING YOUR BUSINESS PLAN & PUTTING IT
INTO ACTION
51
How a Business Plan for Enduring Social Impact Links
Analysis to Strategy to Action.......................................................................51
1. Develop an Action Plan for Phase One ................................................52
2. Compile the Sections of Your Business Plan into One
Document and Add Appendices ...................................................................53
3. Write an Executive Summary ..................................................................53
4. Seek Review and Approval........................................................................53
5. Prepare to Launch Your Road Show .....................................................54
Concluding Step 4 ..............................................................................................54
CONCLUSION
55
APPENDICES
57
Appendix A: Glossary .......................................................................................57
Appendix B: Outline of a Business Plan for Enduring
Social Impact .......................................................................................................60
Appendix C: Sample Work Plan ...................................................................61
Appendix D: Project My Time Phase One Action Plan —
Communications Section ................................................................................63
Appendix E: Bonnie CLAC Business Plan for Growth ........................68
v
ACKNOWLEDGMENTS
We are grateful to the many people who contributed to the content and development of this guide. Special thanks to Beth Anderson,
Kristin Bierfelt, Colleen Connolly, Anand Dholakia, Elizabeth Hunt,
Brook Manville, and Julie Zack for editorial review.
A number of the organizations we have worked with also helped us to
draw on their experiences to develop this guide:
Laura Robbins
The Atlantic Philanthropies
www.atlanticphilanthropies.org
Robert Chambers
Bonnie CLAC
www.bonnieclac.org
Jean Horstman
InnerCity Entrepreneurs (ICE)
www.innercityentrepreneurs.org
Katherine Freund
ITNAmerica
www.itnamerica.org
Marcia Kerz
OASIS
www.oasisnet.org
Maureen Gallagher
Partners for Youth with
Disabilities (PYD)
www.pyd.org
Arlene Williams
Project My Time
www.cyitc.org
Susan Musinsky
Social Innovation Forum
www.socialinnovationforum.org
William Straub
TAP-IN
www.tap-in.org
Nancy Devine
Sheila Murphy
The Wallace Foundation
www.wallacefoundation.org
Introduction
HOW TO
USE THIS GUIDE
Root Cause’s approach to consulting for organizations whose primary
mission is social impact combines strategy with organizational and leadership development. We work in direct partnership with our clients, leading
them through a process of exploration to realize their aspirations.
Our examples reflect our work with nonprofits that have already been
operating for several years, and are looking to bring renewed focus and
growth to their organizations and activities. However, we believe that
business planning is an essential tool for guiding organizational actions
and acquiring resources for all types of organizations whose primary mission is social impact—nonprofits, government agencies, and for-profit
enterprises alike—at any stage of development. With this in mind, we
have prepared this guide for four major uses:
1. A practical introduction to the business planning process. This
how-to guide introduces business planning to nonprofits, foundations, government agencies, and for-profit enterprises whose
primary mission is social impact.
2. A step-by-step guide for nonprofit organizations, or programs
within these organizations, seeking to develop a business plan
on their own. The guide will be particularly useful for existing
organizations, and we recommend reading the guide in its entirety
before getting started.
3. A primer on business planning for those seeking external business planning support. Nonprofits, government agencies, and
for-profit enterprises choosing to hire external support may use this
guide to get started thinking about the selection process, and to
prepare to make the most of the business planning engagement.
4. A college text for social entrepreneurship courses. Instructors of
social entrepreneurship can use this guide to teach students how to
create a practical business plan for enduring social impact.
For a glossary of business planning terms, see Appendix A. For a sample business plan for enduring social impact, see Appendix E.
vii
Introduction
INTRODUCTION TO
BUSINESS PLANNING FOR
ENDURING SOCIAL IMPACT
THE PROMISE OF BUSINESS PLANNING
Imagine a day when organizations whose primary mission is social
impact — nonprofits, government agencies, and for-profit enterprises
alike — use business plans as their road maps. These business plans
define organizational focus and strategy; establish rigorous methods of
measuring impact; provide guidelines for making data-driven decisions
and improvements; and aid in establishing reliable streams of financial
and in-kind resources. As a result, they facilitate the rapid generation
of successful and lasting solutions to a wide variety of social problems, including poverty, domestic violence, unequal
Imagine a day when organizations access to health care, and the achievement
whose primary mission is social gap in education.
impact — nonprofits, government
agencies, and for-profit
enterprises alike — use business
plans as their road maps.
The recent boom in the field of social entrepreneurship,1 supported by the
change in strategy of a number of national
foundations,2 has begun to make the above
vision a reality. The past decade has seen the emergence of scores of new
social-entrepreneurial organizations, the most prominent of which include Teach For America, for which Founder Wendy Kopp was recently
profiled as one of U.S. News and World Report’s Top 25 Leaders; Muhammad Yunus’s Grameen Bank, which was awarded the Nobel Peace Prize
1 We define social entrepreneurship as the practice of responding to market failures
with transformative, financially sustainable innovations aimed at solving social
problems. Market failure occurs when the cost of a good or service is higher than the
price that individuals are able or willing to pay, yet the social benefits from that good or
service make availability worthwhile for maintaining a healthy, productive society. For
a full discussion of social entrepreneurship and the unique way in which it responds to
market failures, see Andrew Wolk, “Social Entrepreneurship and Government,” December 2007, in the U.S. Small Business Administration’s annual Report to the President,
available at www.rootcause.org.
2 Sometimes referred to as venture or engaged philanthropy, this new funding strategy
combines grant making and management assistance for nonprofit social entrepreneurs.
Some of the groups best known for this approach include The Atlantic Philanthropies,
Edna McConnell Clark Foundation, New Profit Inc., Robert Wood Johnson Foundation, Roberts Enterprise Development Fund, Robin Hood Foundation, the Skoll
Foundation, Venture Philanthropy Partners, and the Wallace Foundation.
1
2
for 2006; and Benetech, for which founder Jim Fructerman received a
“genius” award from the MacArthur Foundation. These organizations
are demonstrating a unique way of responding to social problems that
draws on the kind of private-sector strategic thinking that business
planning facilitates. What social-entrepreneurial initiatives have in
common, and what business planning can help to apply, can be characterized by the following four principles:
Identifying new opportunities within a particular social problem
Developing innovations that lead to promising new approaches
Demonstrating accountability by regularly measuring performance
and impact
Securing predictable revenue sources that achieve financial
sustainability
Whether you are encountering the term “social entrepreneur” for the
first time or you are a veteran in the field, business planning is the essential tool for applying these principles to social problem solving. A
good business planning process produces an in-depth understanding of
a target social problem that results in identifying opportunities that exist to address it. Whether you are encountering
This process also articulates the innovations the term “social entrepreneur” for
that will help to create promising new ap- the first time or you are a veteran
proaches. The final product, a complete in the field, business planning
business plan, demonstrates a commitment is the essential tool for applying
to accountability by including a rigorous the principles of opportunity,
measurement system for assessing and im- innovation, accountability, and
proving performance. It also includes a plan financial sustainability to social
for achieving financial sustainability,3 which problem solving.
ties funding to results and helps to attract
funders who seek to invest and re-invest in organizations that demonstrate a clear path to enduring social impact. For this reason, we will
use the term social impact investor throughout this guide to refer to
anyone who provides resources to fund a business plan for enduring social impact.
3 We will discuss the process of achieving financial sustainability in more detail in step
three.
Introduction
To illustrate the promise of business planning, let’s consider the
experience of ITNAmerica™, a nonprofit organization offering a safe,
sustainable, consumer-oriented transportation service for older drivers.
In 2005, Executive Director Katherine Freund received funding from
The Atlantic Philanthropies, the Great Bay Foundation for Social Entrepreneurs, and the Sam L. Cohen Foundation to develop a business
plan that would enable her 10-year-old Portland, Maine – based program
to increase its impact in addressing the lack of transportation options
for seniors in the United States. Through
Business planning is an
business planning, the organization eximportant tool for organizations
plored opportunities to expand its flagship
developing and scaling solutions
to social problems and for the program in Portland to other cities, and it
organizations that invest in them. articulated the innovations that helped
make the organization’s approach unique.
The final business plan included a measurement system to provide the
organization with data to demonstrate the current and future impact
of the model, while continuing to improve upon it. It also outlined a
financial sustainability plan, including steps to raise the $5.4 million
cost of the plan over five years. Within just three months of completing
its business plan, the organization secured $3.5 million, putting ITNAmerica well on its way to the mix of reliable revenue sources necessary
for long-term financial sustainability. As of August 2007, ITNAmerica
was operating services in Portland, Maine; Charleston, South Carolina;
Santa Monica, California; the Quad Cities of Iowa and Illinois; and Orlando, Florida — with preparations underway to start programs in ten
additional cities.
Business planning constitutes an important tool not only for organizations seeking to develop and scale solutions for addressing social
problems, but also for the organizations that invest in them. For example, The Wallace Foundation relies on business planning to guide
its grant making and ultimately amplify the impact of its current efforts
to promote arts learning and out-of-school learning opportunities in
Boston, Chicago, Dallas, New York, Providence, and Washington, D.C.
The foundation provides support to a range of organizations — including
arts and cultural institutions, community-based organizations, and public agencies — generally beginning with funding for a planning process,
which includes the development of a business plan. Wallace considers the planning phase of its grants as a means of engaging public and
3
4
private leadership, gathering necessary facts, and helping the city determine the best way to achieve sustained, citywide impact. Wallace then
decides whether to make substantial, multi-year investments — based
on the business plan’s commitment to innovation and accountability,
and on the quality of its financial sustainability plan.
The promise of business planning is quite simple: it ensures that
organizations and their social impact investors are working together
to address their target social problems with approaches guided by the
principles of opportunity, innovation, accountability, and financial sustainability. With a business plan serving as a road map, organizations
and their social impact investors can communicate around a common
point of reference, while following a clear course of action that will lead
to enduring social impact.
Business Plans Serve as Road Maps and as a Means of Communication
between Organizations and Their Social Impact Investors
ENDURING
SOCIAL IMPACT
ORGANIZATION
BUSINESS
PLAN
SOCIAL IMPACT
INVESTORS
WHAT IS A BUSINESS PLAN FOR ENDURING
SOCIAL IMPACT?
In the private sector, a business plan is a document that articulates
the steps that a company will take to generate profit, while making a
case that will attract traditional investors. It is a road map for carrying
out an organizational strategy and a sales pitch in one.
A business plan for enduring social impact applies the same strategic rigor and financial savvy to social problem solving. It defines a course
of action — generally spanning three to five years — that will guide your
Introduction
organization in generating another kind of profit: lasting social impact.
It also shows potential social impact investors how their money will be
put to use, including the specific results, or “social returns,” that they
can expect.
A well-constructed business plan for enduring social impact should
tell a clear and compelling story about your organization’s target social
problem, the unique approach that you will take to address it, and the
impact that such an approach will have. Its length will be determined by
the amount of space needed to tell that story accurately and convincingly: some plans can be as short as 20 pages while many are about 50
pages. Appendices are about twice the length of the written document;
thus a full business plan with appendices is generally 60 – 150 pages. It
should be considered a living document, parts of which you will revisit
based on your experience during the implementation process.
A complete business plan will:
1. Serve as a road map: The business plan delineates a course of
action for your organization’s leadership, established governance
structure, and social impact investors to follow in carrying out the
organization’s mission, making day-to-day decisions, and ultimately creating enduring social impact.
2. Support the acquisition of resources: The business plan will
become your most important fundraising tool as you solicit new
and returning investments from corporations, foundations,
government, and individuals, and seek sources of earned income
and in-kind goods and services.
3. Provide a method of measuring and monitoring performance:
A business plan provides a common point of reference for stakeholders outside of your organization. In particular, it will enable
board members to evaluate and understand your performance,
and it will allow social impact investors to ensure that their
money is being used well.
4. Help to establish partnerships: The business plan will also
become an essential recruitment tool as you identify partnerships
and solicit political support from a variety of stakeholders.
5. Enrich your field: Finally, the business plan will contribute to
the field surrounding your organization’s target social problem,
5
6
by articulating your approach to the problem in a form that can
be shared with practitioners, social impact investors, researchers,
and policy makers.
For an outline of a complete business plan for enduring social impact,
see Appendix B.
HOW TO...
Understand Strategic Plans vs. Business Plans
Many organizations in the nonprofit sector are more familiar with strategic plans than
with business plans. The biggest difference between the two is their scope:
Strategic Plans generally explore organizational values, goals, and objectives from an
internal point of view.
Business Plans serve as road maps to guide organizations in carrying out their missions,
as sales documents to aid in acquiring financial and in-kind resources, and as a way
for you to communicate your progress to social impact investors. Elements of strategic
planning are always part of a complete business planning process. Business plans consider
an organization’s work in the context of the overall needs and opportunities surrounding
the target social problem. They also identify the niche that the organization can fill, list
the specific strategies that the organization will take to fill that niche, and provide a plan
for acquiring the necessary resources to carry out and sustain its work.
WHAT TO CONSIDER BEFORE YOU START
There are four major questions for any organization to consider before starting a business planning process:
1. Do you have an idea of where you want to go? A business
planning process provides a rigorous framework for developing
the best possible approach for achieving your intended social impact. It works best when you already have a general idea of what
you are doing and what you would like to accomplish. When this
is the case, the business planning process can help bring your
organization’s future direction into focus.
2. Are you ready for the demands of business planning? Business
planning inevitably provokes hard questions and requires tough
choices, and it is important to prepare yourself for the demands
of the process. Along the way, you may uncover the need to
Introduction
better allocate resources by cutting one program or expanding
another. A business plan can also reshuffle organizational responsibilities and roles, or call for major internal cultural change. To
reap the benefits of business planning, your organization — including staff and board members — must be open to making
difficult decisions and responding to whatever you discover during the process. Additionally, and perhaps most importantly, your
organization must be willing to carry out what will inevitably be
an ambitious course of action aimed at growth, and a higher level
of accountability than you may be accustomed to, once the plan
is complete.
3. Can key staff members make the time commitment? Business
planning also requires a considerable time commitment from an
organization’s leadership. You will need to consider who will be
involved and whether these potential members of your business
planning team can commit sufficient time.
For organizations considering As a general rule, conducting a complete
hiring external support, there business planning process on your own
are three basic types: university requires the equivalent of one senior-level
support, project management, and staff person working full time for about 120
full consulting engagements. days. Of course, in practice, that work will
be divided between the members of your
business planning team. This team typically includes your organization’s leader, other members of the senior management team,
one or more board members, and, in some cases, representatives
of stakeholder groups who can provide insights in considering the
organization’s future.
Developing the plan takes anywhere from four to nine months,
depending on how much time you will want to devote to thinking through the options and decisions that come up along the
way. During that time, the business planning team will meet
about every four to six weeks for anywhere from two to six hours,
with additional time required between meetings. Your organization’s leader can expect additional work between meetings.
4. Will you plan on your own or with external support? Finally,
you will need to decide whether to develop your business plan
independently or to bring in outside support. If you choose to run
7
8
the process on your own, it is important to designate a member of
your leadership team to lead the process, along with a lead writer
and a facilitator. This option is obviously the least expensive in
terms of financial commitment, but also requires the greatest
internal staff and board commitment.
For organizations considering hiring external support, there are
three basic types available:
University Support. Some organizations choose to engage an
M.B.A. student or team for guidance in developing a business
plan or portions of it. The advantage of this, of course, is that
such engagements are inexpensive or free. Given their tight
schedules and limited experience with business planning, M.B.A.
students tend to be most helpful when you can give them a welldefined assignment. A portion of the business plan, such as the
development of the research-intensive “Need and Opportunity”
section,4 is an ideal project.
Occasionally, business schools also offer free consulting engagements through alumni consulting teams.
Project Management. It is also possible to hire a facilitator or
project manager with business planning experience. The project
manager will create a work plan, offer expertise, and help your
business planning team stay on track — in addition to facilitating
some working sessions. The bulk of the researching, analyzing,
and writing will be conducted by your team.
Full Consulting Engagement. In a full consulting engagement,
an independent consultant or consulting firm directs the business
planning process, carrying out the bulk of the research and writing
of the business plan, while leading the organization through the
decision making that the business planning process entails. Designated staff members from the organization will work closely with
the consultant(s) to collect information on the organization and
its field, create and review the necessary documents, and make key
strategic decisions about the future of the organization. With such
an engagement, you are paying for the time saved by your team,
in addition to a consultant’s or firm’s methodology, knowledge,
skills, experience, and impartial external viewpoint — which is
4 We will describe the “Need and Opportunity” section in detail in step two on page 17.
Introduction
often essential to making good choices when tough questions arise.
A consultant will also bring experience with facilitation, financial
analysis, planning and implementation, and writing and constructing a document for an investor audience. Finally, the consultant
may also have relationships with potential social impact investors
that could prove useful to your organization.
HOW TO...
Know When to Hire External Support
In recent years, a number of foundations have begun to provide support
for hiring consultants to conduct a business planning engagement. Since
a primary goal of business planning is to secure the resources necessary to
implement the final plan, identifying a social impact investor to help fund
the process is an excellent first step. Such investors are often willing to make
larger investments when they have seen a completed plan. In addition, it
is worth keeping in mind that the planning process will benefit from the
external, objective point of view that a consultant can provide. This often
also lends greater credibility to the resulting business plan.
We believe that deciding on whether to do internal planning or hire outside
support should be based primarily on your organization’s access to resources
for business planning. Consider who in your network may be interested in
supporting some or all of a business planning process. Reach out to other
organizations that have gone through the process and learn from them how
they were able to acquire support.
If you do not think your organization can find the resources to pay for external
support, and you have answered yes to the first three questions on pages 6 –7,
under “What to Consider Before You Start,” we recommend using this guide
to plan on your own.
9
THE BUSINESS PLANNING PROCESS
This introduction has described the promise of business planning for
enduring social impact, and provided an overview of the considerations
required of any organization before embarking on a business planning
process. The rest of this guide will explain the planning process in four
steps: 1) Planning to Plan, 2) Articulating a Social Impact Model,
3) Developing an Implementation Strategy, and 4) Finalizing Your Business Plan & Putting It into Action.
Overview of the Business Planning Process
Finalize Your
Plan & Put It
into Action
Develop an
Implementation
Strategy
Articulate a Social
Impact Model
Plan to Plan
ENDURING
SOCIAL IMPACT
Step 1: Planning to Plan
STEP 1
PLANNING TO PLAN
GOAL:
Establish your business planning processes, collect existing information, and identify the additional work that you will need to do in
order to complete each section of the business plan.
Step one encompasses the following tasks aimed at getting the business planning process up and running:
1. SELECT YOUR BUSINESS PLAN WORKING GROUP
A business plan working group — the team of people who carry out
the business planning process — has three main purposes: 1) to discuss
and make decisions to support the development of the business plan, 2)
to provide feedback on drafts of the sections of the business plan, and 3)
to decide when sections and the complete plan are ready to be shared
with other stakeholders, in order to aid in winning buy-in of the business
plan each step of the way.
With this in mind, consider who will need to be in the room to ensure
that the plan gets the right mix of perspectives, and the greatest possibility for approval. In most cases, the key players will be easy to identify,
and they typically include your organization’s leader, management-team
members, and the board chair if you have one. Ordinarily, five to seven
people is a good target size. With new or very small organizations, however, the working group could consist of as few as one or two people.
No matter how big or small your working group, it is important to define a decision-making process at the outset. The group should commit
to consensus-based decision making, and to keeping decisions final once
they are made.
2. ESTABLISH A STAKEHOLDER UPDATE PROCESS
While the working group will do the hard work of developing the
plan, it is equally important to consider the process through which the
plan will be supported and approved. Start by listing all the stakehold-
11
12
ers whose input you value, including your board of directors, whose
legal responsibilities to your organization make their approval essential. Also consider anyone outside of your working group who may
help to determine your plan’s success, such as local politicians, partnering organizations, current and past clients, and members of other
leading organizations in your field.
All of your stakeholders should be informed that you have begun a
business planning process and of your estimated completion date. You
should also keep your stakeholders updated throughout the process.
There are many ways to do this. Some organizations choose to send
regular e-mail updates, while others stay in touch through one-on-one
phone calls, conference calls, or meetings. Many organizations send out
drafts of portions of the business plan.
These exchanges with external stakeholders will provide the working group with additional feedback and help to create buy-in — which
will be critical when you seek to approve the
plan, and when you begin to raise resources All of your stakeholders should be
and form partnerships with your completed informed that you have begun a
plan. If your business plan is financially sup- business planning process and of
ported by a foundation, it is also important your estimated completion date.
to keep the foundation informed of the
progress of the plan, whether they need to approve it or not, so that
there are no surprises when you submit the final version.
3. CREATE A WORK PLAN AND APPROVAL DATES
The work plan serves as the working group’s to-do list and timeline
for the entire process. A good work plan sets meetings as far out as
possible, and establishes deadlines for checking in on progress, drafts,
feedback, and approval. If you will need board approval, you should also
select the board meeting at which you will approve the final business
plan. Your work plan will most likely change as you enter further into
the business planning process. However, it is important to have it in
place — in order to provide focus from the outset, and so that scheduling meetings does not delay progress along the way. For a sample work
plan, see Appendix C.
KEY TO SUCCESS
Step 1: Planning to Plan
Don’t Skimp on Planning to Plan
You are guaranteed to run into delays and encounter more difficulties securing investments for your plan if you do not complete
each component of step one before engaging in the rest of the
planning process.
4. BEGIN PLANNING A ROAD SHOW
Road show is a private-sector term that refers to the practice of securing financing before a company issues a public offering of stock. For
our purposes, it is a public announcement of your completed plan that
includes meetings with key potential social impact investors aimed at acquiring the investment necessary to implement phase one of the plan.
Begin by developing a list of all of your current and potential social impact investors. You should let them all know about your business planning
process as soon as you begin. As your planning progresses, send brief updates to everyone on your list. Also make sure that at least one person
within the organization — usually the organization’s leader — is preparing
to pitch the business plan to these current and potential social impact
investors at a series of meetings once the plan is complete. We will revisit
the road show process in steps three and four, on pages 34 and 54.
5. CONDUCT A GAP ANALYSIS
In order to build on existing information and avoid duplicating work,
write up a gap analysis. A gap analysis consists of identifying the work that
has already been done for each section of the business plan and listing the
key areas that require additional work. Begin by gathering all the relevant
information for each section of the business plan. This includes your most
up-to-date financials, which will allow you to enter the business planning
process with a clear sense of your financial situation. Additionally, if your
organization has recently completed a strategic plan or possesses an older
business plan that needs updating, those documents should inform the
new business plan as well. You may also have organizational and program performance indicators, background information on your field, or
research on the work of your peer organizations. All of this information
will help you prepare for the discussions you will hold in future steps of
the business planning process, and ensure that all of your organization’s
planning documents are in sync.
13
CONCLUDING STEP 1
Before proceeding to step two, make sure
that you have established all of the schedules
and systems that will facilitate the business
planning process. In step two, you will put
those systems to use to articulate your Social
Impact Model.
STEP 1 CHECKLIST
Business plan working group
Stakeholder update process
and schedule
Work plan and approval dates
Road show list of social
impact investors to update
and target
Gap analysis
KEY TO SUCCESS
14
Work with an Executive Coach
In recent years, some consulting firms have begun including
coaching for the leaders of their client organizations, and
occasionally other members of the senior management team, as
part of their engagements. Such coaching can include training
in time management, day-to-day decision making, meeting
management, hiring, and how to stay focused on your organization’s
priorities. Business plans often call for major changes that require
the development of new skills. Starting such coaching early in the
business planning process, and continuing it during implementation,
can help the leadership team to obtain these skills. Whether you are
planning on your own or working with a consultant, we recommend
seeking out executive coaching opportunities as part of the business
planning process.
Step 2: Articulating a Social Impact Model
STEP 2
ARTICULATING A
SOCIAL IMPACT MODEL
GOAL:
Articulate a model that clearly connects the target social problem
with your mission, approach to the problem, social impact strategies, intended impact, and vision of what success will look like.
egies
This step will ground your approach in the social-entrepreneurial
principles of opportunity, innovation, and accountability.
The Social Impact Model articulates your organization’s hypothesis
about the best way to address your target social problem, as well as the
actions that you will take to test and measure that hypothesis, while
working toward an enduring solution. As such, it provides the framework that will guide all the work carried out by your organization, at
least over the three-to-five-year time frame of the business plan. Other
methods for developing a framework for
The Social Impact Model
achieving social impact employ a theory of
articulates your organization’s
hypothesis about the best way to change or a logic model. Root Cause’s Soaddress your target social problem cial Impact Model blends the big-picture
as well as your actions to test and thinking of the theory of change and the
measure that hypothesis. step-by-step reasoning of the logic model,
and adds a feedback loop that enables organizations to continually improve their performance. Once your Social
Impact Model is in place, the rest of the business planning process will
be aimed at developing a plan for implementing your model and continually testing and improving upon it.
The Social Impact Model is also the key to grounding your approach
in three of the core social-entrepreneurial principles: opportunity, innovation, and accountability. Your Social Impact Model will be informed
by a need and opportunity analysis, which reviews the context of your
target social problem and identifies unique opportunities to address it.
As you make decisions about how to further address those opportunities, you will bring into focus the innovations that make your approach
unique. Lastly, by clearly stating the logic between your approach and
the impact it will have, you will make yourself accountable to the results
that your plan predicts.
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The following diagram shows the components of the Social Impact
Model at work.
Social Impact Model
TA
DA
SOCIAL PROBLEM
DEFINITION
A concise description of your target
social problem,
which begins to
clarify your niche.
MISSION
A description of your
purpose, including
your target beneficiaries, activities, and
expected outcomes.
SOCIAL IMPACT STRATEGIES
The major strategies
identified in your business
plan to further your
mission and make progress toward your vision
of success.
SOCIAL & ECONOMIC
IMPACT INDICATORS
OPERATING MODEL
A description of the
way in which your
activities work
together to carry out
your mission.
ORGANIZATIONAL & PROGRAM
PERFORMANCE INDICATORS
Units of measurement that
assess your long-term
progress toward your vision
of success and the overall
success of your hypothesis.
Units of measurement that
assess the direct short-term
results that relate to your
capacity to carry out your
work and your progress in
implementing your social
impact strategies.
ACK
FEEDB
OP
LO
The social problem definition, mission, and vision of success constitute the foundation of your Social Impact Model; these components
will remain the same throughout the time period covered by your business plan. To test your hypothesis about the best way to address your
target social problem, your organizational and program performance
indicators and social and economic impact indicators will measure your
short- and long-term impact. In addition, they will create a feedback
loop that will enable you to make course corrections to improve your
operating model and social impact strategies.
Below, we discuss each of the components of the Social Impact Model
in detail, in the order in which we recommend developing them. We’ll
use as our example an organization for which Root Cause has developed
a Social Impact Model that is in its pilot phase.
SOCIAL PROBLEM DEFINITION
The left-hand side of the diagram marks your starting point: articulating the target social problem. To do this, you must conduct a need
and opportunity analysis, which will enable you to produce a concise
description of your target social problem, and to identify your niche in
addressing it.
VISION OF SUCCESS
A description of how
the world will be
different if you are
ultimately successful in addressing a
target social problem and a description of your role in
realizing that vision.
Conducting a Need and Opportunity Analysis
The need and opportunity analysis is made up of two main components:
a study of the trends contributing to the target social problem along with
the current work being done to address it, and a
Ultimately the need and description of the opportunity that your organizaopportunity analysis tion has identified for putting its unique approach
constitutes the basis of an to work. Ultimately these two components conargument that explains: why stitute the basis of an argument that explains:
now and why your approach? why now and why your approach?
A need and opportunity analysis typically covers the following topics:
Market Need: A data-driven description of the social problem in its
current context.
Current Trends: An overview of the current social, political, legal,
and economic trends affecting your target social problem.
Root Causes: A theory about the root causes of the social problem,
based on the research conducted above and a literature review of current debate and thinking by academics, policy experts, and other leaders
in your field.
Environmental Landscape: A description of the approaches of
other organizations working on the social problem — the competitive
landscape — and of the gaps that still remain in addressing the social
problem. This analysis of the competitive landscape can begin to illuminate the opportunity on which you are acting and that makes your
approach unique.
Barriers: A discussion of the challenges to making progress in addressing your target social problem, in the context of the information
described above.
Opportunity: A summary of how the above information frames an
opportunity to test a hypothesis about how to accelerate progress in addressing the target social problem, and why your organization is uniquely
positioned to do so. This usually includes a brief introduction to your
organization’s approach as well as information about your organization’s
progress to date, including recent data about its impact.
In your completed business plan, the results of your need and opportunity analysis will appear as an independent “Need and Opportunity”
section. As the first section of the business plan, it should provide a
hook that entices your audience to continue reading.
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Defining the Social Problem through the Need and
Opportunity Analysis
As you conduct the research that will provide you with the information listed above, you will begin to form an in-depth understanding
of the aspect of the social problem that your organization is uniquely
positioned to target. This will inform the first component of your Social
Impact Model: a social problem definition.
Your social problem definition must be based on the research conducted and the data collected in your need and opportunity analysis.
It should be specific enough to begin to frame your unique approach to
addressing the problem.
Our example organization is an overseas Root Cause consulting client focused on improving the lives of senior citizens. Below are two of
the conclusions reached in its need and opportunity analysis.
1. Currently, there is little collaboration and coordination among
service providers for the country’s senior citizens.
2. Many seniors in the country do not know what services are
available to them.
The social problem definition that followed from these and other conclusions is: “the current national infrastructure required to meet present
and future needs of people entering their aging years is not adequate and
will have a dramatic impact on their lives.”
VISION OF SUCCESS
Returning to our Social Impact Model diagram from page 16, the
next stop is the vision of success, pictured in the far right-hand side of
the diagram. While every organization should also have an idea of the
success that it would like to see for itself over the long term, this organizational success should always be envisioned within the context of a
broader vision of success: an explanation of what success in addressing
your target social problem will look like. As with your social problem
definition, the vision of success should come directly from the research
conducted in the need and opportunity analysis.
For example, our organization focused on seniors has the following
vision of success: “We envision a day when — through collaboration and
coordination of government, nonprofits, and the business sector — all
seniors, regardless of economic status, will have access to a seamless
integration of the high-quality, affordable services they need in order to
live healthy and productive lives.”
This would be a very different and much less reasonable vision of
success if it did not include the phrase “through the collaboration and
coordination of government, nonprofits, and the business sector.” One
organization alone could never hope to meet all the needs of senior citizens, but it could hope to organize a network that makes this possible.
This vision of success is clearly based on the social problem definition
given above. It also articulates a long-term goal that is ambitious enough
to be motivating and inspiring to its stakeholders, yet grounded in the
organization’s understanding of what’s possible.
SOCIAL AND ECONOMIC IMPACT INDICATORS
Next, it is time to begin to develop your social and economic impact
indicators, which assess your organization’s long-term progress toward
meeting your vision of success, and ultimately determine whether your
hypothesis about your approach to solving
Social and economic impact your target social problem is working. In
indicators will help to ensure some measurement methodologies, the longthat your organization’s vision term results that social and economic impact
of success is grounded in a set of indicators measure are known as outcomes.
achievable, yet ambitious, targets. Your social and economic impact indicators
will help to ensure that your organization’s
vision of success is grounded in a set of achievable, yet ambitious, targets — while providing you with the means of generating evidence of your
organization’s overall impact.
Here are some social and economic impact indicators chosen by our
organization focused on seniors:
The number of seniors matched to services
The number of service providers who better meet senior service
needs by doing one or more of the following:
» adding or making improvements to service
» serving a new geographic area or market
» improving affordability
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Looking at your vision of success, create a list of three to five indicators that will aid you in measuring progress toward your vision of
success. In step three, we will describe the process of further developing
your list of social and economic impact indicators.
MISSION
The next step is developing your mission statement, which is the
second box on the left in our Social Impact Model diagram (see page
16). While many organizations state their missions in very broad terms,
we believe that a mission should describe your target beneficiary, the
activities conducted by your organization in
order to address its target social problem, and A good mission statement
the outcomes that you expect to achieve. A will help your organization to
mission statement that contains this infor- determine what it will do and
mation will provide an accurate, measurable what it will not do.
description of your work, against which you
can gauge your organization’s progress. It will also help your organization to determine what it will and what it will not do in the future.
The mission of our organization focused on seniors, for example, is:
“to determine the needs of seniors and link them to necessary resources
so that they can lead healthy and productive lives in their aging years.”
Notice how the target beneficiaries (seniors), the organization’s major
activity (connecting seniors to services), and the desired result (seniors
leading healthy and productive lives) are each included here.
OPERATING MODEL
The next component is an articulation of your operating model — the
way in which your organization’s activities work together to carry out
the mission developed above. To bring your operating model into focus,
you will need to conduct an operating model analysis, which will help
you to review your activities and begin to uncover opportunities to improve upon current practices.
Much of the information for your operating model analysis will
come from the documents that you gathered in your gap analysis,
including your organizational budget, descriptions and evaluations
of your current programs, and documentation of your current management and staffing structure. You should also plan to conduct
interviews with your organization’s program directors and management team to gather additional information as you address the
following questions.
How would you describe your organization’s current missionbased activities? The goal here is to begin to tell a story that
explains how the activities that you undertake to carry out your
mission work together. Make a list of all of your current activities
that address your mission, and think about how you would describe
them. For example, do you think in terms of departments? Stages in
a process? Or types of programming?
Who makes up your target market? Your target market consists of
the primary beneficiaries of your programs and services. Using data
generated from your current activities, develop a profile of the characteristics of your target market. These characteristics may include
age, geography, and income level.
How are you currently measuring the performance of your
programs and your long-term impact? Take stock of the indicators and methods, if any, that you are currently using to evaluate
your programs.
What staff positions are needed to carry out your operating
model? Develop a list and a short description of the critical roles
needed to carry out these activities.
What does your operating model cost? Look at your expense
records to determine the cost of your activities, not including your
overhead costs. If the activities generate any earned or recurring
revenue, gather this information as well.
Your answers to these questions will allow you to create a text document, and possibly a diagram, that explains: how all of your programs and
activities work together toward your mission; what groups are brought
together by your programs; how evaluation is integrated into your work;
how much these activities cost; and how much, if any, earned income
you bring in. In your written business plan, this text and diagram will
become your “Operating Model” section, which immediately follows the
“Need and Opportunity Analysis.”
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KEY TO SUCCESS
22
Engage in Action while Planning
The biggest risk in business planning is ending up with a plan that
doesn’t get put to use. To ensure that your plan won’t gather dust once
it’s complete, we recommend choosing one or two projects that you feel
confident you can undertake during the process, without limiting the
direction of your business planning. We call this action while planning.
It can be as simple as testing ways to market to your target beneficiary,
designing an application process once it becomes clear that you will
be using one, or learning more about how to design a new service for
which you have discovered a need. The operating model analysis is
one of the first parts of the business planning process that uncovers
such opportunities.
To see successful action while planning at work, take the example
of Partners for Youth with Disabilities (PYD), which connects youth
with disabilities to adult mentors who provide guidance in meeting
their personal, educational, and career goals. PYD was interested in
developing a business plan to launch a technical-assistance arm of its
already well-established direct service program. During the planning
process, PYD identified target markets for selling its mentoring
approach to other organizations serving youth with disabilities. While it
was developing its staffing and financial models, senior staff members
began making test sales calls to peer organizations, particularly those
that had previously inquired about such a service. These initial calls
allowed the organization to practice something new, while testing
price points and gauging how much time they would need to allot for
such calls. Staff members debriefed members of the working group
about the calls, and were able to better set their own sales targets.
As a result of the calls, the organization also uncovered several good
sales leads to follow up on once the business plan was complete.
Engaging in action while planning will help your organization avoid
a major pitfall in business planning — getting caught up in worrying
about raising the money before you can implement the plan. Acting
on small projects early will help to dispel this fear. It also shows
potential social impact investors that your plan is not just an idea, but
a course of action that is already underway. Inevitably, organizations
that act confidently and build momentum during the planning process
have the most success in securing investments.
SOCIAL IMPACT STRATEGIES
We move now to the social impact strategies, which are the major
actions that your organization will take to carry out its mission and to
strengthen its operating model, while working toward achieving its vision of success.
Basing decisions on the results of the need and opportunity analysis
and operating model analysis, many organizations at this stage will determine that they are doing too much. It is not uncommon to end up
cutting one program in order to devote more resources to another — or
to recalibrate an existing program. The Root Cause consulting client
that focuses on seniors had primarily served
It is not uncommon to end up as an advocacy organization before begincutting one program in order ning the business planning process, and had
to devote more resources to only recently begun helping seniors connect
another—or to recalibrate to services. Yet, the organization’s need and
an existing program. opportunity analysis uncovered a need for
better linking and delivering services to the
country’s seniors. In addition, the operating model analysis revealed
that its existing direct-service programs promised to yield the greatest
social impact. As a result, the organization determined to focus on partnering with government to meet seniors’ needs, instead of advocating to
government. It developed the following social impact strategies:
Collecting data on the needs of the nation’s seniors through a partnership with the federal government
Matching seniors with service providers through a membershipdriven, technological solution
Building and strengthening a service provider network through conferences, data reports, and training to help service providers increase
the effectiveness, efficiency, and sustainability of their services
Running a “direct service incubator” to develop new services when
a gap is identified
These strategies are all directed toward achieving the vision of success stated earlier: “We envision a day when — through collaboration
and coordination of government, nonprofits, and the business sector — all seniors, regardless of economic status, will have access to a
seamless integration of the high-quality, affordable services they need
in order to live healthy and productive lives.”
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KEY TO SUCCESS
24
Look at the Big Picture and Think Creatively
Social impact strategies must be research supported, but don’t
let this limit you. The key to developing successful social impact
strategies is making use of the components of the Social Impact
Model developed up to this point to think outside the box. The
information provided by the need and opportunity analysis and
operating model analysis—along with the organizational focus
captured in the vision, mission, and social and economic impact
indicators—should empower you to develop innovative strategies
that will test your hypothesis and set you on your way to enduring
social impact.
ORGANIZATIONAL AND PROGRAM PERFORMANCE
INDICATORS
Once you know your social impact strategies, you can begin developing your organizational and program performance indicators. These
indicators measure your organization’s capacity to implement its business plan, and assess the progress of your activities in carrying out your
operating model and social impact strategies; in
some measurement methodologies, these types of When your complete measurement
short-term results are known as outputs. Develop- system is in place, your indicators
ing your organizational and program performance will serve as a feedback loop that
indicators will help to ensure that your organiza- can help your organization make
tion is accomplishing what you intended to in the course corrections along the way.
short term — in order to achieve your vision of
success in the long term. When your complete measurement system is
in place, these indicators will also serve as a feedback loop that can help
the organization make course corrections along the way.
Looking at your own social impact strategies and the activities they
encompass, make a list of three to five indicators that will enable you to
measure your organization’s overall performance. For example, here are
a few of the organizational and program performance indicators chosen
by our organization focused on seniors:
the number of members
the number of volunteers serving its programs
the number of seniors assessed
As with the social and economic impact indicators above, you do
not need to develop an exhaustive list. In step three, we will describe
the process of further developing a list of organizational and program
performance indicators.
FEEDBACK LOOP
Keep in mind that two components of your Social Impact Model — the
operating model and social impact strategies — are always works in progress, which you will continue to hone based on the results that your
indicators reveal. In step three, you will plan for developing a comprehensive self-evaluation system that will include a feedback loop. This
feedback loop will establish the systems that will ensure that you regularly
return to your operating model and social impact strategies to make improvements based on the data generated by your measurement system.
It will also help you evaluate whether your overall hypothesis of how to
solve your target social problem is working.
KEY TO SUCCESS
The other components of your Social Impact Model, particularly your
mission and your vision of success, should stay the same for the time
period covered by your business plan, and should only be revisited when
you revise your business plan.
Start Writing Early and Plan for Appendices
It can be quite challenging to capture decisions made by your
working group in a written document. Doing so, however, is critical
to communicating your business plan to your stakeholders. To give
yourself the time to get it right, start writing as soon as you have
completed your Social Impact Model. You will be able to complete
drafts of three sections of the business plan at this point: “Need and
Opportunity,” “Operating Model,” and “Social Impact Model.”
As you draft each section of your business plan, it is also a good idea to
highlight the parts of the plan that could be supported by appendices.
Generally, a good business plan includes three different types of
appendices: 1) data, charts, or additional information supporting
various aspects of the plan, 2) documents that show evidence of
the organization’s past success, and 3) letters of support from
stakeholders praising the organization and its plans for the future.
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CONCLUDING STEP 2
The work that you have done in step two
will turn into drafts of three sections of your
business plan: “Need and Opportunity,” “Operating Model,” and “Social Impact Model.”
The working group should review and approve the content of all of these sections.
STEP 2 CHECKLIST
Draft of “Need and Opportunity” section
Draft of “Operating Model”
section
Draft of “Social Impact Model”
section
Preliminary approval of all
three of the above by the
working group
Begin stakeholder and road
show updates
Step 3: Developing an Implementation Strategy
STEP 3
DEVELOPING AN
IMPLEMENTATION
STRATEGY
GOAL:
Part One: Decide on the time period that your business plan will
cover, and establish a set of goals for the first phase of that timeline for each of the social impact strategies identified in your
Social Impact Model.
Part Two: Determine how you will develop the organizational capacity necessary for implementing your social impact strategies,
with specific goals for each of the following sections: Team and
Governance, Financial Sustainability, Marketing, Technology,
Public Policy, Measurement, and Risk Mitigation.
This step will ground your business plan in the social - entrepreneurial
principles of financial sustainability and accountability.
In the previous step, we described the process of creating a Social
Impact Model that culminates in a set of social impact strategies that
will guide your activities and lead you toward realizing your vision of
success. In step three, you will develop your implementation strategy,
which outlines the actions needed to put your social impact strategies
into action.
PART ONE
Setting a Timeline &
Establishing Your Phase One Strategy Goals
BUSINESS PLAN TIMELINE
A business plan timeline identifies the time frame covered by your business plan. The timeline generally has two or three phases spanning three
to five years.
Phase one of your timeline constitutes a 12- to 24-month pilot phase for
testing the social impact strategies. Your implementation strategy will
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focus primarily on phase one. Phase two focuses on expanding your
organization’s reach, and it will have less detail than phase one in your
completed plan. Organizations that choose to have a phase three will
use this period to provide readers of your business plan with a description of your organization’s long-term vision of success.
The chart below provides an example of the phases of a business plan.
PHASE
GOAL
Phase One: Test each social impact strategy, link the strategies
Pilot and assess performance of the strategies individu-
ally and collectively, and make improvements.
Phase Two: Expand the reach of the social impact strategies
Roll Out to provide evidence of a sustainable model and
progress toward achieving the vision of success.
Phase Three: Further scale the social impact strategies, achieve
Scale (optional) financial sustainability, and test additional inno-
vations.
PHASE ONE STRATEGY GOALS
Once you know your time frame, you can begin to detail how you will
put your social impact strategies into action. Setting phase one strategy
goals gets this process underway by restating each social impact strategy
as a goal, and listing the activities that will
Once you know your time frame,
lead to accomplishing that goal.
you can begin to detail how
OASIS, a national nonprofit providing you will put your social impact
lifelong learning and service opportunities strategies into action.
for older adults, provides an example of
how this works. One of the social impact strategies that resulted from
the organization’s business planning process with Root Cause focused
on “increasing the services and tools that the national headquarters,
known as the OASIS Institute, provides to local OASIS centers.”
In the “Phase One Strategy Goals” section of its business plan, OASIS
attaches the following goal to this social impact strategy: “streamline and
strengthen the training and other services that the institute provides to
the centers.”
It then provides a list of the actions that the organization will need to
take in phase one in order to meet this goal:
1. Define a menu of all available services, looking at both the cost
to the institute and the value to the centers/directors.
2. Develop and implement a training/professional development
model with input from the director.
3. Develop and implement services to help the local centers address
human resource policies, liability insurance, local contracts, and
other legal issues.
4. Develop and implement a standardized annual member survey to
be used across all centers.
5. In preparation for phase two, assess performance, determine
key success factors, and make improvements based on lessons
learned.
As this example shows, your phase one strategy goals should begin to
ground your social impact strategies in a set of concrete actions. Returning to your own social impact strategies, rewrite them as goals that you
will seek to accomplish in phase one of your business plan. Next, develop
a list of the key activities that you will need to undertake in order to meet
each of those goals.
PART TWO
Building the Organizational Capacity to Implement Your
Social Impact Strategies
The rest of step three is an iterative process dedicated to determining
how to build the organizational capacity you will need to implement
your social impact strategies. You will hash out the details of putting
your Social Impact Model to work throughout this step.
We divide the capacity-building portion of your implementation
strategy into seven main sections: Team and Governance, Financial
Sustainability, Marketing, Technology, Public Policy, Measurement,
and Risk Mitigation. Two of the most critical of those sections, Financial Sustainability and Measurement, will provide you with a financial
model and a self-evaluation system in order to ground your business
plan in the social-entrepreneurial principles of financial sustainability
and accountability.
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In the pages that follow, we discuss how to develop each section of the implementation strategy in the order in which it appears
in the final business plan, starting with a set of core questions that
should guide the development of each. We end our discussion of
each section with some suggestions on what to include in the corresponding written section of your business plan. As you did above
with each of the social impact strategies, you will want to develop one phase one goal for each section, in addition to a list of
actions that will lead to accomplishing that goal during phase one.
TEAM AND GOVERNANCE
What new roles will you and your staff need to take on?
Are there new staff positions that you will need to fill? If so,
what are they and when can you afford to fill them?
If you have a board, how will their roles be affected by the
business plan?
Business plans are only as good as the people who can execute them,
and this section ensures that you will have the human resources required
to implement your social impact strategies successfully. Developing it involves an assessment of your current staff members’ skill sets, the new
skills that staff may need to acquire, and any new positions that you may
need to fill.
First, develop a list of the roles, responsibilities, and skill sets of your
current key paid team members, board members, and volunteers. Then
compare this with a list of the human resources needed to implement
your social impact strategies in phase one. You will likely find that your
social impact strategies call for new roles for current staff, in addition
to the hiring of more staff members. You should also clearly articulate
the board’s structure and the roles for each of its members, particularly
its officers. In addition, doing the same for any current or future board
committees will help facilitate smooth execution of the business plan.
Finally, if volunteers are a core component of your operating model,
define the role that volunteers will play in implementing your business
plan. When you have defined all of the above roles, create a new organizational chart.
Returning to our senior services organization, let’s consider the team
and governance component of its implementation strategy. As mentioned in our discussion of the Social Impact Model, the organization
developed a business plan aimed at building a national network to coordinate the work of organizations that currently provide services to
the country’s growing population of senior
Business plans are only citizens. To this end, the organization called
as good as the people who for several changes relating to team and
can execute them. governance. First, the organization rewrote
the job descriptions for its three existing
senior staff members. In addition, the organization decided to create
two new positions, including a director of development, to sustain
its new growth plan, which required a significant increase in reliable
philanthropic contributions over time. Board members received new,
more clearly defined roles under the team and governance plan as well.
Finally, the organization developed a plan for incorporating volunteers
into the operating model, outlining the specific roles that volunteers
would play. As a result, the organization ensured that its team and
governance would put the organization in the best possible position to
implement its new social impact strategies.
When you write up your “Team and Governance” section, it should
include the roles of current and new staff, as well as your timeline for
new hires and a new organizational chart. Also describe your governance structure and the roles volunteers will play. The goal that you list
in this section should relate to revised staff and governance structure.
FINANCIAL SUSTAINABILITY
How much money will you need over the specified period of
time of the business plan?
How will you capitalize — or raise the resources required
for — your business plan?
What mix of reliable resources will you seek in order to
achieve financial sustainability?
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Once you have a sense of your staffing needs, which are typically the
most expensive aspect of your business plan, you can begin to determine
how much implementation of the plan will cost, and how to acquire the
resources. It is important to start early on this section, which grounds
your business plan in the social-entrepreneurial principle of financial
sustainability. Completing it will be a continuous process throughout
step three, as you estimate the costs of all sections of your implementation strategy.
KEY TO SUCCESS
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Consider Your Organizational Culture
Every organization has its own unique culture. As you prepare to
carry out social impact strategies that will likely involve new hires,
you should understand the nature of the culture you’ve created,
particularly the parts of it you want to maintain. One way to do this
is to hold a discussion at your next team meeting and identify three
to four characteristics that you think make your organizational
culture unique. Be sure to discuss your organizational culture with
candidates for new positions to get a sense of their ability to adapt
to and participate in this culture. This should be a major part of your
consideration as you select new hires.
You will work toward two goals within this section:
Capitalization: identifying the total amount of philanthropic investment needed — not including earned income and future funds that
have already been committed — in order to execute the business
plan and developing a plan for acquiring the necessary resources for
phase one.
Financial sustainability: developing a financial sustainability plan,
which identifies a reliable and at times diversified revenue mix that
will ultimately allow you to predict your annual revenue and its
sources with reasonable certainty.
Generally, organizations will require significant initial philanthropic
investments, which serve as seed money, before achieving the ideal revenue mix that will bring about financial sustainability. The “Financial
Sustainability” section, then, should lay out a capitalization plan aimed
at getting your organization to the necessary mix of reliable funding
streams. (The capitalization plan is what you will begin carrying out
with the road show that you began preparing in step one.) In some cases,
organizations will achieve financial sustainability by the time they reach
the end of the business plan timeline. In other cases, they will still be
making progress toward financial sustainability when the time period
covered by the business plan ends.
To get started, return to the financials that you gathered in step one,
including up-to-date revenue and cost statements. You will also need to
know your cash balance as of the last day of the most recent month so
that you can begin to develop projections. Then follow the three steps
described below:
1. Estimate Costs
Begin by reviewing and making any necessary changes to the types
of expenses incurred by your organization. Then estimate the costs for
all aspects of implementing your business plan. Phase one will be the
primary focus of these projections, since much can change by the time
you get to phases two and three. You should estimate phase one costs
on a monthly or quarterly basis so that you can pay close attention to
cash flow, and phases two and three on a yearly basis. Look closely at
the aspects of your business plan that require a significant capital investment, such as technology or hiring additional staff or consultants. It is
important to get estimates from trustworthy sources for these types of
expenses, in order to make your calculations as accurate as possible.
2. Estimate Capitalization Required
Once you have a sense of the cost of implementing your business
plan, review your current and projected revenue to determine your
funding needs for each phase of implemenGenerally, organizations require tation. Begin with your earned revenues, if
significant philanthropic any, and subtract the estimated expenses for
investments, which serve as seed implementation. This is illustrated in the diinvestments, before achieving agram on the next page as Profit/(Loss). You
the ideal revenue mix for may already have committed philanthropic
financial sustainability. revenue to list, to which you will add figures
for any likely philanthropic revenue. After
you’ve subtracted committed and likely philanthropic revenue, you’ll
arrive at the capitalization amount necessary to implement each phase
of your business plan.
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The figure on the next page shows an example of this type of calculation. In this scenario, the organization would need to raise $1.3 million
in phase one and $6.9 million in phase two, for a total capitalization of
$8.2 million.
Sample Calculation of Capitalization Required
PHASE ONE
PHASE TWO
TOTAL
Earned Revenues
TIME PERIOD
$173,000
$662,000
$835,000
Expenses
$3.5 million
$8.1 million
$11.6 million
Profit/(Loss)
($3.3 million)
($7.4 million)
($10.7 million)
Committed
Philanthropy
$500,000
$375,000
$875,000
Likely Philanthropy
$1.5 million
$202,000
$1.7 million
Total Philanthropy
$2.0 million
$577,000
$2.6 million
Capitalization
Amount
($1.3 million)
($6.9 million)
($8.2 million)
KEY TO SUCCESS
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Don’t Forget Your Road Show
Once you have a draft of your “Financial Sustainability” section in
hand, you will have an idea of how much money you will need to
raise. At that point, it is time to return to the list of potential social
impact investors that you developed for your road show in step one.
Provide these investors with an update, and, if possible, arrange to
set up a meeting or invite them to a gathering within a few weeks of
the plan’s expected approval date.
3. Develop a Plan for Capitalizing Phase One and Achieving
Financial Sustainability
Models for operating in a state of financial sustainability differ greatly
depending on the type of social problem you are addressing. Yet, all tend
to include two fundamental components:
Predictable revenue sources: These are long-term, repeat, and
performance-based funding sources — foundation, individual, government, corporate, and fee-based — that your organization believes it
can rely on with reasonable certainty.
Non-financial resources: These are skilled or unskilled volunteers,
and one-time or recurring in-kind donations that enable organizations to increase the sustainability of their initiatives.
In general, before reaching financial sustainability, nonprofits generate the vast majority of their revenue from unpredictable philanthropic
sources — mostly foundation grants that
Your written “Financial tend not to support the same organizations
Sustainability” section should over long periods of time. Capitalizing
include the total capitalization your business plan, then, often requires
required to implement your seeking philanthropic and other revenue
business plan, and a full set of sources that will move you toward finanfinancial statements. cial sustainability. If your business plan
was sponsored by a foundation, this is a
good place to start. This is also the primary purpose of your list of social
impact investors for your road show — to help you capitalize phase one.
To work toward financial sustainability, it is important to find ways to
develop earned income streams, when possible, and to increase predictable philanthropic revenue. Earned income streams from government
fee-for-service and membership fees, in addition to individual donors
and corporate partners, are often core elements of an organization’s financial sustainability model.
The pie charts below show a sample strategy for shifting an organization’s revenue toward more predictable funding sources — such as earned
income and individual donors — over the course of four years. Notice the
shift away from unpredictable revenue toward earned income, individual
donations, and corporate sponsorships; all of these represent funding
sources that tend to be more reliable.
FY 2007
FY 2011
Unpredictable Revenue
11%
Earned
15%
Individual 5%
Sponsorships/Events
8%
Corporate Partner 2%
Unpredictable
Revenue
78%
Sponsorships/Events
0%
Corporate
Partner
17%
Earned
36%
Individual
28%
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The financial sustainability plan is one of the most important components of the business plan, as it is a powerful fundraising tool. For instance,
a nonprofit equipped with a plan for achieving financial sustainability in
its third year of operation, through a combination of individual giving,
membership fees, and government fee-for-service, has a great pitch for
seeking foundation funding. Foundations will see that an investment in
the first three years will not only achieve social impact, but also support the organization in reaching a stage in which little or no foundation
funding is needed.
HOW TO...
Capitalize a For-Profit Business Plan for Enduring Social Impact
For-profit organizations whose primary mission is social impact tend to be operating in lowprofit markets, which are not yet developed enough to provide the return on investment
generally expected by traditional investors. There are two major financial sustainability
models for these types of for-profit enterprises:
1. The organization can achieve financial sustainability by developing a low-profit market
into one that will eventually allow the organization to exist as a traditional for-profit
company. In some cases, the organization will rely on patient capital from social
impact investors who are willing to accept below-market returns for an extended
period of time as the organization works toward developing a market that will
eventually lead to more traditional returns on investment.
2. If it is not possible to advance beyond low-profit-market conditions, the financial
sustainability model will continue to rely on this patient capital, which will come
from social impact investors who are willing to accept below-market returns for
social impact.
The first challenge in capitalizing a for-profit business plan for enduring social impact
is that you may have no track record. To win investor confidence, it is important to
determine the minimum investment necessary to meet a major milestone that will prove
your concept and attract future investments. By investing the least possible amount of
money in the first stage of testing your idea, you and your social impact investors will
keep your financial losses to a minimum if the venture fails. Many for-profits rely on their
founders’ own resources at the beginning. As you test the ideas and generate proof of
potential profitability, you can seek outside social impact investors more easily.
For-profits face an additional challenge at the outset: many investors believe that
organizations whose primary mission is social impact cannot make money. For this reason,
it is important to develop financials that show a decent rate of return in comparison to
other similar investment opportunities. If your financials cannot show how you intend to
make a profit and offer a return to investors, raising money will be a challenge — unless
your investors consider the money as philanthropy.
Your written “Financial Sustainability” section should include the total capitalization required to implement your business plan, a full set of
financial statements based on the timeline of the business plan, and a
description of your plan for achieving financial sustainability. This section’s goal should focus on capitalizing the business plan and achieving
financial sustainability.
MARKETING
What standards and systems do you need to put in place
in order to communicate your work in consistent and
compelling ways?
What types of communications or marketing would best
reach your target market(s)?
What are the critical partnerships that your organization
should make to ensure success?
Increasing the impact of your organization requires ensuring that
the standards and systems are in place to communicate what you do
in a compelling way, in order to reach the groups that will help you
to increase your impact. These groups include the beneficiaries of your
programs, or your target market, and potential partners — including
social impact investors, local decision makers, and leaders of peer organizations. To this end, the Marketing section is made up of three main
parts: brand and communications, target marketing, and partnerships.
Brand and Communications
In order to develop a clear brand and communications strategy, it is
best to start with an audit. This audit is aimed at determining the systems
and standards necessary to communicate your approach to creating social impact to others: social impactinvestors, clients, partners, employees,
board members, and other stakeholders. Many organizations choose to
bring in a communications consultant at this stage, as the better you are
able to communicate with your stakeholders, the greater success you
will have in getting them excited about your work. Furthermore, strong
communications are essential to attracting new social impact investors,
partners, and participants for your programs.
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The following list describes what your audit should consider:
1. Messaging and Brand Standards: The foundation of a solid
brand and communications strategy is consistent messaging
and branding. Start by reviewing the documents that your
organization uses to describe its work to any of the above
groups. Does the way that you currently describe your organization provide people who may not be familiar with your
organization with a clear sense of what you do? Does this
messaging convey the promise of your work — the vision of
success that you are working toward? Does it have the potential to capture the attention of your stakeholders?
Also, look at the way in which you represent your brand.
Do you have guidelines for using logos and colors associated
with your brand that can serve as sources to draw on for
future documents? If so, do you have templates for memos,
slide presentations, job descriptions, and other materials
that will ensure consistent branding and messaging — in
addition to helping to make the process of creating new
materials more efficient?
Make a preliminary list of your organizational needs based on
your answers to these questions.
2. Communications Materials: Whether or not you have the
above standards in place, your audit should also look at the
types of communications materials that you are already using.
These may include:
» A Web site
» An editorial calendar of newsletters and other publications
for communicating to targeted groups
» An online forum for national communication with the
public on the target social issue
» A conference or event dedicated to raising awareness of
the target social issue and positioning the organization as
a leader in its field
» Brochures and other public documents that showcase your
organization’s perspective on your target social problem
and how your solution can make a lasting impact
» Core media messages, based on analyses of past earned me-
dia coverage whenever possible
» News articles and press releases targeted to appropriate
KEY TO SUCCESS
media markets in order to deliver specific media messages
Strive for Sustainability in All Aspects of Your Plan
Organizations tend to think about sustainability primarily from a
financial point of view. Yet, a strong business plan for enduring social
impact will consider sustainability more broadly. For example,
your business plan should enable you to stay on course in the
event of leadership change — which may require establishing a
succession plan. Another example may be ensuring that the new
systems that your business plan establishes become a lasting part
of your organization’s approach to its work. An organization should
also consider sustainability in terms of the political landscape
in which you operate. This could mean keeping a close watch on
policies affecting your target social problem and staying in contact
with politicians. As you develop each section of your business plan,
consider how you can ensure that your individual actions will result
in a sustained social impact—even beyond the period covered by your
business plan.
Which of these items will generate the most benefit for your organization depends on the audiences you want to reach and the resources
available to you. An organization setting out to influence its field with
a new approach to preventing domestic violence, for example, might
prioritize conferences or other meetings aimed at influencing other organizations working on the same issue. An environmental organization
working to pass a new pollution-prevention bill might choose to run
a media campaign aimed at raising public awareness of the issue and
support for the campaign. Organizations focused on building a member
base or reaching a community around a particular interest area might
center their efforts on sending out an e-newsletter and creating an online forum.
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Target Marketing
This part of your Marketing section will identify how you will reach
out to your target markets. Depending on your Social Impact Model,
you may have numerous target markets. In addition to direct beneficiaries, they may also include volunteers and new cities into which your
organization hopes to expand.
It is important to develop a clear profile of each of the groups included in your target markets. Then you can begin developing the strategies
that will allow you to reach out to those groups, and to improve upon
them as you continuously strengthen the profile of your target markets
and utilize your marketing dollars more wisely.
Bonnie CLAC, a New Hampshire–based nonprofit that helps individuals build credit and obtain low-interest car loans, provides an example
of a target marketing plan. First, based on its operating model analysis,
the organization determined that the clients best positioned to benefit
from its programs generally have the following characteristics: they do
not have accounts in collection and they have an average annual salary of $20,000 or higher, with at least $300 of disposable income after
monthly expenses are paid. With this profile in hand, Bonnie CLAC
developed a series of marketing strategies, including increasing client referrals, direct marketing through newspaper advertisements, and direct
mail. The organization also began offering its services through partnerships with local corporations whose employees fit this profile, and with
organizations that help low-income people with financial planning or
job training.
Partnerships
Partnerships are essential to strengthening your operating model and
scaling your social impact. Partnerships can also provide access to new
markets and ultimately help to better serve
the communities that your programs and Partnerships are essential to
strengthening your operating model
services are designed to benefit.
and scaling your social impact.
With this in mind, determine which areas of the operating model provide the best
opportunities for building upon existing partnerships or forging new
ones. Then develop criteria for identifying partners in each of these areas. For example, if your operating model requires access to volunteers
with legal skills, you may want to seek a partnership with a law firm, and
you will want to determine what kind of law firm would make the best
partner for your organization. To do this, list criteria that will allow you
to compare law firms. At the same time, consider what you have to offer
in the partnership — as all successful partnerships provide value for both
parties, and you will need to communicate this.
When you draft your “Marketing” section, it should include a list of
what you need to get your brand and communications systems ready
to carry out your social impact strategies; a description of your target
market(s) and how you will reach them; and a description of the areas
in which you hope to seek partnerships, the ideal characteristics of
your partners, and a short list of current or possible future partners you
will reach out to. Your goal in this section should center on meeting
the needs identified for brand and communications target marketing
and partnerships.
TECHNOLOGY
How is your organization currently using technology both
for internal operations and for your external work?
Does your business plan’s potential to succeed depend on
technology improvements?
Where can you find resources to get this done?
A robust technological infrastructure — including measurement systems,
contact databases, and proprietary technology that aids in carrying out
your operating model — is the single most important factor in expanding the reach of an organization. Making
Organizations that devote changes to existing technology or impleresources to technology can menting new technology solutions often
gain a significant increase in requires hiring an outside technology
their efficiency, effectiveness, consultant (unless you have this expertise
and sustainability, as well as a in-house), in addition to making a significompetitive advantage. cant initial investment. Avoiding these
hurdles by passing over the “Technology”
section may be tempting, but the rewards of a solid technology plan
make it well worthwhile.
The right technology can greatly increase your organizational capacity,
while enhancing your ability to serve your target population, to connect
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with other stakeholders, and to demonstrate your organization’s impact
with the data you collect over time. Organizations that focus on devoting
resources to technology can gain a significant increase in their efficiency,
effectiveness, and sustainability, as well as a competitive advantage.
For example, in developing a transportation service for seniors that operates nationwide, ITNAmerica’s leadership realized that the organization
required a robust technology infrastructure to manage the service logistics and the community outreach necessary
for financial sustainability. The organization In many cases, developing a solid
built ITNRides™, a customized technology technology plan constitutes the only
system that uses a Geographic Information way for an organization to scale.
System (GIS) and a database to manage all
aspects of the ITN operating model. ITNRides became the cornerstone of
the organization’s social impact strategies for nationwide expansion.
ITNAmerica illustrates an important lesson for organizations engaging in business planning. In many cases, developing a solid technology
plan constitutes the only way for an organization to succeed at achieving
greater efficiency or to scale a program that is working well. It is simply too
expensive to rely on human capital for work that technology could better
accomplish. At the same time, it can be challenging to raise money for new
technology. Including a technology plan as part of an overall business plan,
which clearly demonstrates the link between technological infrastructure
and the mission of the overall organization, is often the best way to attract
social impact investors willing to support technology improvements.
As you transcribe the decisions made here into your “Technology”
section, make sure to include a thorough description of the technology that will aid you in carrying out your Social Impact Model. The
goal for this section should state the specific changes you will make to
existing technology.
PUBLIC POLICY
What are the current local or national public policies that
relate to your target social problem?
Are there challenges your business plan might face that legislation at the state or federal level might help alleviate?
Is there an opportunity for your model to spread nationally
through state or federal legislation?
If an organization or initiative can devote the necessary resources, the
“Public Policy” section of an implementation strategy can be critical to
achieving large-scale social impact. Even if you decide not to prioritize
public policy initiatives, understanding the public policies surrounding
your target social problem will provide you with a much greater chance
of successfully implementing your business plan. In any work aimed at
solving a social problem, there will always be local, state, or national
public policies affecting your approach to your target social problem.
A good business plan includes a section that identifies key players and
policies (current or potential) that would aid your organization in scaling its approach. Ultimately, the public policy portion of the business
plan provides a chance to plan for larger systemic change — beyond
your organization’s ability to have social impact on its own. It pinpoints
opportunities for altering the very policies that may help to scale your
organization’s approach or that may be contributing to the social problems that your organization’s work addresses.
As an example, let’s consider a policy action taken by ITNAmerica.
A core part of ITNAmerica’s operating model in Maine was the ability
to accept donated or traded cars to use as part of its service, and to sell
them to raise money. In the first years after the CarTrade™ program
was developed, however, the organization faced a challenge in its home
state of Maine: a state law required ITNUltimately, the public policy Portland™ to accept only a limited number
portion of the business plan of donated or traded cars unless they met
provides a chance to plan for the requirements of a car dealership — a
larger systemic change. two-bay garage and a mechanic on duty.
After researching the issue, ITNAmerica
discovered that the state of Maine had made an exception to this law
in recent years for nonprofit organizations that accepted used cars as
donations and repaired them for low-income people to help them get to
work. Appealing to the legislature’s transportation committee, ITNAmerica made the case that if helping low-income people was a worthy
exception in the interest of society, so was helping older people who
wanted to trade their own cars to pay for their own rides. As a result of
ITNAmerica’s efforts, Maine’s Act to Promote Access to Transportation for
Seniors, sponsored by State Senator Michael Brennan, passed in 2005.
It provides an exemption from automobile dealership laws for any public or nonprofit organization that uses automobile donations to provide
transportation for older persons, or that takes personal automobiles in
trade from older persons in exchange for transportation services.
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ITNAmerica’s experience demonstrates how to get started on a public
policy section. First, conduct research to identify politically feasible public policy initiatives that could help strengthen your operating model,
while benefiting other groups as well. Then begin looking into your network to determine how you can build the relationships that you need to
start working on the change that you would like to bring about.
Your written “Public Policy” section should describe the public policies affecting your work and how you might expect to contribute to
influencing them. The goal for this section should focus on what needs
to happen to get this work done.
PERFORMANCE AND SOCIAL IMPACT
MEASUREMENT
What indicators will you need to evaluate and hone your
operating model and social impact strategies?
What systems do you need to create in order to ensure
that you are measuring your performance regularly and
using those results to make improvements to your operating
model and social impact strategies?
How will you report your results both internally
and externally?
Measuring your performance and social impact is the best way to
commit to the social-entrepreneurial principle of accountability, while
maintaining a high level of quality and developing a track record that
will help you secure new and returning investments. In this section, you
will further develop the indicators that you started on as part of your
Social Impact Model as part of a comprehensive self-evaluation system
that is focused on enabling your organization to assess its own capacity
and performance, and to use the results to make improvements to its operating model and social impact strategies.51Your self-evaluation system
will also test your hypothesis of the best approach to generating enduring social impact. To accomplish this, complete the following actions.
5 For more detail on how to create a self-evaluation system, see our forthcoming
how-to guide “Performance Measurement for Enduring Social Impact: Five Steps to
Putting Measurement to Work for Your Organization” at www.rootcause.org/
knowledge_sharing.
1. Develop Your Indicators
Return to the organizational and program performance indicators
and the social and economic impact indicators that you began developing in the Social Impact Model.
Organizational and program performance indicators
Remember, some of these indicators will help you to assess your organization’s capacity and may include your organizational budget, months
of cash reserve on hand, staff size, and turnover. As you begin measuring
these indicators regularly, they will provide
A self-evaluation system enables you with a sense of how efficient, stable, and
your organization to assess its own sustainable your organizational capacity is.
capacity and performance and use
the results to improve its operating
model and social impact strategies.
Now think about what you will need to
know in order to evaluate your operating
model and social impact strategies, to reach
your phase one strategy goals. Returning to your Social Impact Model,
review these two components and continue to work from the list you
already developed. For example, your list may include the number of
people served or number of members. Make sure your list also includes
indicators that will allow you to assess progress in phase one for each
of your social impact strategies.
HOW TO...
Performance Measurement for Enduring Social Impact: Five Steps to Putting
Measurement to Work for Your Organization
By developing your own self-evaluation system, you are taking a major step toward
ongoing improvement and communication of your impact. Some organizations will
choose to take measurement a step further, by hiring a third-party evaluator, such as
a market research firm or an academic research team. If your organization receives,
or plans to solicit, a significant amount of government funding, we highly recommend
third-party evaluation — as it is often critical to securing stable federal or state funding.
Third-party evaluation, however, is not for everyone, as it is time-consuming and
costly. For most organizations primarily funded by foundations and individuals, a selfevaluation system is the most time- and cost-effective option. If you are unsure about the
measurement requirements of your social impact investors, we recommend consulting
with a few of them at this stage in the business planning process.
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Social and economic impact indicators
These are the most challenging indicators to develop and measure,
as you will be looking to test your hypothesis of the long-term social
impact you expect your operating model and your social impact strategies to have on your target social problem. Even organizations that are
preparing a business plan internally may find it worthwhile to engage an
external firm for this section of planning. To build on the list of social
and economic impact indicators that you created in step two, try to look
at recent research on your target social problem, and select the indicators that are most widely agreed upon. For example, an organization
aimed at getting high school students into college would want to know
what percentage of graduates of the program go on to enroll in a college
or university. Of those, the organization may also want to calculate how
many complete a degree and, possibly, the types of careers they choose
and the average salaries they earn afterward.
2. Set Targets to Measure with Your Indicators
Whether you are developing indicators on your own or with external
help, you will need to set some targets, when possible, against which
you will measure your progress. For each
There are two types of reports
indicator, determine your baseline from
that will enable you to analyze
existing data. Then identify the target that your data regularly, communicate
you will be aiming for in the first phase of your progress, and use the data
your business plan or some shorter period to improve your operating model
of time. If you are developing an indicator and social impact strategies:
with no existing data, you may not know dashboards and report cards.
your baseline, so it will be more difficult to
set a target; in that case you should make sure you are gathering enough
information to establish a baseline and set a target in the near future.
For example, consider a membership organization that has chosen the
total number of members as one of its indicators. Its current, or baseline,
membership is 20,000, and it has set a target of 50,000 members by the end of
phase one of its business plan. Keep in mind that your baselines and targets
will change as you gain more experience during the implementation of your
business plan and gain a better sense of baselines in your field and realistic
targets for your organization. What is most important is to set them if you
haven’t already.
HOW TO...
Lead Your Field with a Research Agenda
If your organization is interested in leading your field, developing a research agenda,
based on data generated by your self-evaluation system or a third-party evaluator, is an
excellent way to do so. You can start by seeking out academic departments or individuals
specializing in your field. Most researchers are more than happy to find a new, reliable data
set that is relevant to their work. Partnering with researchers often results in published
papers, which can provide excellent visibility and credibility for your organization.
3. Establish a Feedback Loop
Once you know what you will be measuring, you can plan for establishing a feedback loop that will help you to make course corrections based
on your data. First, your organization will need to decide which methods
it will use to gather information—such as surveys, focus groups, or direct
observation. Then, you can plan for two types of progress reports—dashboards and report cards—that will enable you to analyze your data,
identify opportunities to make improvements to your operating model
and social impact strategies, and communicate your progress and social
impact. A dashboard is distributed internally to staff and sometimes to
board members and includes measurements to help an organization ensure that it is operating in an efficient, effective, and sustainable manner.
Dashboards include all of the indicators selected above. A report card is
an annual, public presentation of a subset of your dashboard measures,
which allows funders and other key stakeholders outside of an organization to monitor the organization’s progress and social impact. Plan to
assign a staff member the task of analyzing data and incorporating the
data into both types of reports.
To illustrate the importance of demonstrating accountability through
regularly published report cards, let’s consider the experience of InnerCity Entrepreneurs (ICE), a Root Cause social enterprise that promotes
job creation, wealth generation, and community development by helping a diverse group of urban entrepreneurs strengthen and grow their
existing businesses. In 2005, ICE released its first annual report card,
which assessed its performance in its first two years of operation. The
report card’s results showed, among other things, that by 2005 ICE
graduates had created 77 new part- and full-time jobs in Boston, 59
percent of which were from the businesses’ local neighborhoods. ICE
entrepreneurs had also increased their sales by more than 13 percent.
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By measuring and publishing these results, ICE was able to secure several new funding sources, including a new six-figure multi-year funder
who helped to cover the salary of a CEO, a new position aimed at enabling the organization to scale nationally. By the time ICE released its
second report card, it was on its way to national expansion, starting with
the opening of a second site to serve urban entrepreneurs in Worcester,
Massachusetts.62
Your written “Performance and Social Impact Measurement” section
should provide a complete list of your organizational and program performance indicators and your social and economic impact indicators,
along with a chart setting baselines and targets when possible. For all
organizations, this section will also include a schedule for measuring
and reporting indicators, and a description of how you will establish the
systems that will allow you to use the information you collect to make
improvements to your operating model and social impact strategies,
while communicating your progress and social impact. Your measurement goal for phase one should relate to putting these systems in place,
and getting your self-evaluation system underway.
HOW TO...
Address Your Organization’s Legal Needs
While not necessarily a section of a completed business plan, legal issues often come
up during business planning. To determine what degree of legal advice you may need,
consider the following questions:
• Have you explored obtaining copyrights or trademarks for any of your work?
• If your organization is currently a nonprofit and does or plans to acquire a substantial
amount of revenue through earned income, do you know if the income is related to
your mission? If this is not the case, you risk needing to pay tax on it, or losing your
501c3 status.
• Do you need to develop a human resources manual?
• Do you have contracts with your employees, independent contractors, and other
entities with financial relationships to your organization?
• Do you have a non-compete agreement with the appropriate parties?
If you answered yes to any of the above questions, it is time to find a lawyer who can advise
your organization.
6 You can download a copy of the ICE 2007 Report Card at www.rootcause.org/social_
enterprises/ice.html. Also look for the Social Innovation Forum’s 2007 Report Card at
www.rootcause.org/social_enterprises/stf.html.
RISK MITIGATION
What are the risks that may limit the possibility of your
business plan succeeding?
What are you planning to do to minimize those risks?
While the previous sections should be developed as part of an iterative process, this component is almost always last. Developing a Risk
Mitigation section allows you to examine the risks that may limit your
business plan’s chances for success, and describes how you will minimize
those risks. It often includes a contingency plan addressing a risk that all
organizations face: what will happen if the organization experiences less
than the predicted success in bringing in revenue? In addition, you may
want to identify one or two core elements of the business plan that must
succeed if the Social Impact Model is to be successful.
Many organizations tend to resist writing a Risk Mitigation section
because they believe that it makes their business plans look weaker. In
reality, however, anticipating potential pitfalls is an important part of
demonstrating the strength of your business plan. For example, TAP-IN,
a project of the American Health InitiaAnticipating potential pitfalls
is an important part of tive, worked with Root Cause to develop
demonstrating the strength of a plan for building a national volunteer
your business plan. network of retired health professionals to
help ease staffing shortages at free clinics. The organization identified several potential barriers to success in
the Risk Mitigation section of the plan. These included the difficulty of
making retired health care professionals aware of volunteer opportunities like TAP-IN, and differing state licensing requirements that would
pose challenges to placing volunteers across states.
By identifying these potential barriers up front, TAP-IN was able to
build strategies for overcoming them into its business plan. For instance,
TAP-IN began testing a variety of marketing strategies in phase one in
order to find the best way to reach retired health care professionals. The
organization also chose to build its model in North Carolina and Virginia, states that are both home to a large number of retired health care
professionals and that have less strict licensing requirements. Phase two
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involved working with free clinic leadership, professional societies, and
licensing boards at the state level to help support the easing of requirements, once a successful model was in place. TAP-IN’s ability to plan for
potential barriers helped to build confidence with potential funders and
to make the implementation of its business plan a success.
The “Risk Mitigation” section of your
business plan should clearly describe each
of the risks you anticipate and the ways in
which you intend to mitigate them. There is
no need for a goal for this section.
CONCLUDING STEP 3
As you arrive at the end of step three,
you should have drafts for all of the sections
listed above and dedicate some time for the
working group to review them. In step four,
you will compile these sections with those
you wrote in step two — and ensure that your
business plan tells a coherent and compelling
story that will help you raise the money you
will need to capitalize your plan.
STEP 3 CHECKLIST
Business plan timeline
Phase one strategy goals
“Team and Governance”
section
“Financial Sustainability”
section
“Marketing” section
“Technology” section
“Public Policy” section
“Measurement” section
“Risk Mitigation” section
List of appendices to complete
in step four
Preliminary approval of the
above sections from the
working group
Refinement of step two
sections and business plan
working group approval
Continue stakeholder and
road show updates
Step 4: Finalizing Your Business Plan & Putting It into Action
STEP 4
FINALIZING YOUR
BUSINESS PLAN &
PUTTING IT INTO ACTION
GOAL:
Compile the sections of your business plan into one document and
add your appendices, write your executive summary, secure final approval of your business plan, and prepare for your road show.
HOW A BUSINESS PLAN FOR ENDURING SOCIAL
IMPACT LINKS ANALYSIS TO STRATEGY TO ACTION
Idea of how to address
a social problem
Need & Opportunity
Analysis
Social Impact
Model
Implementation
Strategy
ACTION PLAN
As we enter step four, you can begin to see how a complete business
plan for enduring social impact incorporates rigorous analysis, savvy
strategic decision making, and a commitment to practicality, in order to
better focus your organization’s idea of where it wants to go and identify
the best course of action. Through the “Need and Opportunity” section, the business plan opens with the big-picture analysis necessary for
understanding your target social problem and the niche that your or-
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ganization can fill. The “Social Impact Model” section articulates your
organization’s hypothesis about the best way to approach your target
social problem, as well as the strategies that will enable you to test and
measure that hypothesis. Following this section, the plan becomes progressively more concrete. The “Implementation Strategy,” developed in
step three, details how to put your social impact strategies to work, and
how to build the capacity you will need in order to do so. Finally, an
“Action Plan” section, created in step four, adds further detail to your
implementation strategy, ensuring that you have a course of action to
follow in the first phase of implementing your business plan.
As you complete and compile your business plan in step four, keep
in mind that the narrative of the plan should follow this same trajectory—from analysis to strategy to action. Step four involves five tasks,
starting with the development of your action plan:
1. DEVELOP AN ACTION PLAN FOR PHASE ONE
In step three, you established phase one goals for each section of
your implementation strategy, and began identifying the activities necessary to complete those goals. An action plan for phase one allows
you to describe in even greater detail the actions needed to meet those
goals. This action plan will serve as your master to-do list to implement the plan.
The action plan is generally a spreadsheet that contains a series of
worksheets. You will have one worksheet for each of the phase one
strategy goals defined at the beginning of
step three. You will also have an additional A good action plan assigns a
worksheet dedicated to your list of goals specific person who will be held
for organizational capacity building. Com- accountable for each goal, along
plete each worksheet by listing the goals with a timeline for achieving each
you identified in step three and providing a goal and activity.
complete list of the activities that will lead
to achieving those goals. A good action plan also assigns a specific person who will be held accountable for each goal, along with the timeline
for achieving each goal and activity.
For an example of an action plan, see Appendix D (page 63). This
appendix shows one worksheet of the action plan for Project My Time,
a nonprofit building an out-of-school time system for children in Wash-
Step 4: Finalizing Your Business Plan & Putting It into Action
ington, D.C. The worksheet represents the list of actions for one of the
organization’s social impact strategies, which focused on building a communications strategy.
2. COMPILE THE SECTIONS OF YOUR BUSINESS
PLAN INTO ONE DOCUMENT AND ADD APPENDICES
Business plans are meant to tell a story of your organization’s planned
social impact that will get current and future stakeholders, including social impact investors, excited and make them want to be involved. With
this in mind, compiling the business plan into one document requires
making sure there is a logical flow between sections.
You will also need to add your appendices at this point. This section
can be quite long, as you will likely have encountered many places in the
writing of your business plan that required additional detail.
If possible, the complete draft should be reviewed and approved by
the working group before you go on to write the executive summary.
3. WRITE AN EXECUTIVE SUMMARY
After completing a full draft of the business plan with which the
working group is comfortable, you can write your executive summary.
The executive summary should be a two-to-four page summary of the
entire plan, focusing particularly on why now and why you; the amount
of funding sought; and the impact you expect to have as a result of
implementing your plan. This document will serve as a short description
of your business plan to send to anyone interested in learning about the
organization’s future plans.
4. SEEK REVIEW AND APPROVAL
The preliminary work you did to develop an update schedule, along
with a work plan and approval process, should facilitate this necessary
part of finalizing your business plan. Following the approval schedules
that you developed in step one, distribute the complete plan to the appropriate reviewers and remind them of the deadlines for approval.
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5. PREPARE TO LAUNCH YOUR ROAD SHOW
While the business plan is in the final review process, it is time to
capitalize on your preparations for the road show. Schedule any meetings with potential social impact investors that are not already on your
calendar, so that the process of raising money for your plan can begin
the moment your business plan receives final approval. Generally, the
road show takes place through a series of gatherings and one-on-one
meetings that present the business plan to funders and other stakeholders, with the goal of raising all of the resources necessary for phase one
of your business plan as quickly as possible.
STEP 4 CHECKLIST
Once you have secured those resources, your
organization can focus 100 percent of its time
“Action Plan” section
on executing the plan.
CONCLUDING STEP 4
As you complete step four, you should
have a complete and approved business plan
in hand, and you should already be preparing
for what comes next: capitalizing your plan
and putting it to work.
Complete business plan,
including appendices
Executive summary
Final approval from the
working group and other
stakeholders
Final schedule of meetings
with potential social impact
investors to launch your
road show
Conclusion
CONCLUSION
Business planning is undoubtedly an intensive process that can feel
daunting at the outset. What makes it worthwhile? Business planning,
when done well, transforms organizations, enabling them to achieve a
level of social impact that was previously unimaginable.
Embarking on a business planning process will push your organization to think about both its long-term impact and the ways in which it
allocates resources on a day-to-day basis. It will provide your organization with the opportunity to talk with social impact investors, board
members, and other stakeholders in ways you never could before, while
giving your organization renewed focus and a clear path forward. Moreover, the recent boom in the field of social entrepreneurship has further
demonstrated the promise of approaching social problem solving with
the strategic thinking that business planWhat makes it worthwhile? ning makes possible. Our own experience
Business planning, when done
has shown us that there is no better way to
well, transforms organizations,
lead a successful organization and to pursue
enabling them to achieve a
enduring social impact.
level of social impact that was
previously unimaginable.
We envision a world in which, much
like in the private sector, organizations and
social impact investors use one document to make decisions about investments and to track progress to determine whether they will continue
to invest. In this scenario, business planning for enduring social impact
directs capital in a logical and predictable manner — to the organizations that demonstrate the best performance and impact. Ultimately, we
believe a world with more business planning has the potential to enable
a wide variety of organizations and their social impact investors to work
together to significantly accelerate solutions to today’s most pressing
social problems.
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Appendix A: Glossary
APPENDIX A: GLOSSARY
Action while Planning: Identifying and undertaking limited projects
during the business planning process that an organization feels confident it can learn from, without limiting the direction of its business
planning. Action while planning projects inform the business plan and
allow the organization to begin testing implementation methods during
the planning process.
APPENDICES
Business Plan for Enduring Social Impact™: A business plan for
enduring social impact applies the strategic rigor and financial savvy of
a traditional private-sector business plan to social problem solving. It
defines a course of action—generally spanning three to five years—that
will guide an organization in generating another kind of profit: lasting
social impact. The completed business plan should also serve as a sales
document to aid in securing financial and in-kind resources, and in arranging partnerships.
Capitalization Plan: In the private sector, capitalization refers to
raising a specified sum of money to fund business activities. In a business plan for enduring social impact, a capitalization plan identifies the
total amount of philanthropic investment that an organization must acquire in order to implement its plan, in addition to outlining the steps
for raising it.
Dashboard: A regular report (monthly, quarterly, yearly) on an
organization’s performance, as measured by its selected indicators. A
dashboard is used by senior leadership to make course corrections, and
it is often distributed internally to staff and board members to track
progress.
Earned Income: Any revenue generated by a nonprofit by charging
for a particular service or product in order to finance its mission.
Executive Coaching: One-on-one advice and insights on decision
making, meeting management, skills assessment, and more for the leader
of an organization, and sometimes for other members of the leadership
team or board.
Feedback Loop: The systems that will ensure that an organization
returns regularly to its operating model and social impact strategies in
order to make course corrections based on the data generated by its
organizational and program performance indicators and its social and
economic impact indicators.
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Financial Sustainability: The state of having a reliable, at times diversified, revenue mix that will allow an organization to predict its annual
revenue and the sources of that revenue with reasonable certainty.
Gap Analysis: The process of identifying the work that has already
been done for each section of the business plan through existing documents, interviews, and working group meeting(s) in order to determine
how much additional work will be needed to develop each section of
the business plan.
In-Kind Resources: Contributions of time, goods, or services to a
nonprofit organization.
Low-Profit Market: A market that is not yet developed enough to
provide the return on investment generally expected by traditional investors.
Market Failure: When the cost of a good or service is higher than the
price that individuals are able or willing to pay, yet the social benefits
from that good or service make its availability worthwhile for maintaining a healthy, productive society.
Mission: A description of an organization’s purpose, including its target beneficiaries, the activities it conducts in order to address its target
social problem, and the outcomes it expects to achieve.
Operating Model: An articulation of the way in which an organization’s activities work together to carry out its mission.
Organizational and Program Performance Indicators: Units of
measurement that allow an organization to assess its capacity and the
outputs, or direct short-term results, of its work. These indicators also
assess the organization’s direct short-term results in accomplishing the
goals set for its social impact strategies.
Patient Capital: Investments made by social impact investors in forprofit companies who are willing to accept below-market returns for an
extended period of time in exchange for social impact.
Report Card: An annual public report of a subset of an organization’s
dashboard results, which allows social impact investors and other key
stakeholders to monitor the organization’s progress and social impact.
Appendix A: Glossary
Road Show: A series of gatherings and one-on-one meetings that
present the business plan to social impact investors and other stakeholders, with the goal of raising all of the resources necessary for phase one
of the business plan.
Social and Economic Impact Indicators: Units of measurement that
assess an organization’s long-term progress toward meeting its vision of
success, and ultimately determine whether the organization’s hypothesis
about its approach to addressing its target social problem is working.
Social Entrepreneurship: The practice of responding to market failures with transformative, financially sustainable innovations aimed at
solving social problems.
Social Impact Investor: Anyone whose primary expectation in providing investment to fund an organization is measurable social impact,
regardless of organizational structure, ego, or political agenda. Social
impact investors may be foundations, corporations, government, or individuals.
Social Impact Model™: Articulates an organization’s hypothesis
about the best way to address a target social problem, as well as the
actions necessary to test and measure that hypothesis, while working
toward an enduring solution. It provides the framework that will guide
all the work carried out by the organization, at least over the time frame
of the business plan.
Social Impact Strategies: The major strategies identified in a business plan for enduring social impact, which will be implemented to
further the organization’s mission and strengthen its operating model,
in order to progress toward achieving its vision of success.
Social Problem Definition: A concise description of an organization’s
target social problem, which begins to clarify the organization’s niche
within its field and is based on the need and opportunity analysis.
Vision of Success: A description of how the world will be different if
an organization is ultimately successful in addressing its target social problem and a description of the organization’s role in realizing that vision.
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APPENDIX B: OUTLINE OF A BUSINESS PLAN FOR
ENDURING SOCIAL IMPACT
I.
Executive Summary
II. Need and Opportunity
A. Overview of Social Problem
B. Current Trends
C. Root Causes
D. Environmental Landscape
E. Barriers
F. Opportunity
III. Social Impact Model
A. Overview of Organization
B. Social Impact Model Diagram (including social problem
definition, mission, indicators, and vision of success)
C. Description of Operating Model
D. Description of Social Impact Strategies
IV. Implementation Strategy
A. Business Plan Timeline
B. Phase One Strategy Goals
C. Organizational Capacity Building
1. Team and Governance
2. Financial Sustainability
a. Financial Projections
b. Capitalization Strategy
3. Marketing
a. Brand
b. Target Market
c. Partnerships
4. Technology
5. Public Policy
6. Performance and Social Impact Measurement
a. Indicators and Targets
b. Feedback Loop
7. Risk Mitigation
V. Phase One Action Plan
VI. Appendix
Appendix C: Sample Work Plan
APPENDIX C: SAMPLE WORK PLAN
MONTHS
1
2
STEP 1: PLANNING TO PLAN
Establish business plan working
group and approval process
Establish stakeholder update process
Develop and agree upon work plan
and approval process
Begin planning road show
Conduct preliminary meetings for gap
analysis
Develop and finalize gap analysis
STEP 2: ARTICULATING A SOCIAL IMPACT MODEL
Conduct need and opportunity analysis
Develop social problem definition
Define vision, preliminary social and
economic impact indicators, and mission
Conduct operating model analysis
Develop social impact strategies
3
4
5
6
7
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62
MONTHS
1
2
3
4
5
6
7
Define preliminary organizational and
program performance indicators
Draft “Need and Opportunity,”
“Operating Model,” and “Social
Impact Model” sections
Obtain preliminary approval of
all three of the above with the
working group
Begin stakeholder and road show
updates
STEP 3: DEVELOPING AN IMPLEMENTATION STRATEGY
Establish business plan timeline
Create phase one strategy goals
Develop “Team and Governance” section
Develop “Financial Sustainability”
section
Develop “Marketing” section
Develop “Technology” section
Develop “Public Policy” section
Develop “Measurement” section
Develop “Risk Mitigation” section
Obtain preliminary approval of all
written sections with the working
group
Continue stakeholder and road
show updates
STEP 4: FINALIZING YOUR BUSINESS PLAN AND PUTTING IT INTO ACTION
Create action plan
Compile business plan and
add appendices
Write executive summary
Review and finalize business plan
Appendix D: Project My Time Phase One Action Plan—Communications Section
Goal: Communicate clear messages about the importance of
out-of-school time to targeted
audiences
A) ESTABLISH BRAND AND MESSAGES
1) Review proposed new name,
tagline, ad campaign
2) Test brand and messages
with tag
3) Test brand and messages
with youth and parents
4) Participate in conference
call with other Wallace cities
to develop consistent,
approachable language to
describe initiative
5) Convene key partners to approve new name, etc.
6) Develop logo graphic tools
7) Develop one-pager and FAQ
with new brand
JUN-07
MAY-07
APR-07
MAR-07
FEB-07
JAN-07
DEC-06
NOV-06
OCT-06
SEP-06
AUG-06 (or before)
INPUT/APPROVAL
PHASE I
LEAD RESPONSIBILITY
APPENDIX D: PROJECT MY TIME PHASE ONE
ACTION PLAN — COMMUNICATIONS SECTION
63
B) DEVELOP COMMUNICATIONS AND OUTREACH TOOLS
1) Create a database of key
contacts, coded by sector,
for broad and targeted
messaging
a) Provide initial set of 200
contacts
b) Research and add 500 contacts to database
c) Acquire DCPS contact list
d) Complete database
e) Manage database
2) Establish quarterly publication of electronic newsletter
a) Develop electronic format
b) Draft content
c) Disseminate first newsletter
d) Ongoing development and
quarterly
dissemination
e) Draft precursor — update
e-letter
f) Distribute precursor —
update e-letter
3) Launch Web site
a) Develop strategy for
targeted audiences
b) Determine appropriate use
of partner sites
JUN-07
MAY-07
APR-07
MAR-07
FEB-07
JAN-07
DEC-06
NOV-06
OCT-06
SEP-06
AUG-06 (or before)
PHASE I
INPUT/APPROVAL
LEAD RESPONSIBILITY
64
B) DEVELOP COMMUNICATIONS AND OUTREACH TOOLS (continued)
c) Develop structure and
content
d) Announce Web site at
Lights On event
e) Monitor Web site usage
4) Produce targeted outreach
materials
a) Develop targeted case
statements for individual
donors, funders, and
businesses
b) Produce and disseminate
DVD
c) Develop flyers and related
materials for pilot parents
and youth
d) Develop materials for
religious leaders in pilot
neighborhoods
e) Develop materials for ethnic and immigrant
organizations
f) Develop posters for pilot
schools
g) Develop materials for
potential champions
JUN-07
MAY-07
APR-07
MAR-07
FEB-07
JAN-07
DEC-06
NOV-06
OCT-06
SEP-06
AUG-06 (or before)
INPUT/APPROVAL
PHASE I
LEAD RESPONSIBILITY
65
C) SECURE MEDIA COVERAGE FOR KEY EVENTS AND INITIATIVE
1) Grant announcement
a) Outreach to media for grant
announcement
b) Document all outlets’
coverage of grant
announcement
2) Launch
a) Prelaunch message
development
b) Prelauch media training
3) Ongoing
a) Produce electronic press
packet
b) Ongoing outreach to
reporters
D) DESIGN PUBLIC EDUCATION CAMPAIGN (with implementation plan)
1) Develop ads based on market
research, general OST messaging and pilot program
specifics
2) Photograph youth at outof-school time programs
3) Review communications audit and revise based on focus
groups research
4) Create draft timeline of
rollout based on
progress and status of pilot
5) Contract with radio and
advertisers per timeline
6) Build public service relationship with hip-hop radio
station
JUN-07
MAY-07
APR-07
MAR-07
FEB-07
JAN-07
DEC-06
NOV-06
OCT-06
SEP-06
AUG-06 (or before)
PHASE I
INPUT/APPROVAL
LEAD RESPONSIBILITY
66
D) DESIGN PUBLIC EDUCATION CAMPAIGN (continued)
7) Build public service relationship with local cable
company
E) HOLD FALL “LIGHTS ON” EVENT
in partnership with “Getting Connected,” DCPS, business, and funding
communities
1) Secure venue
2) Send out save-the-date
notices
3) Develop program
4) Develop budget
5) Hire event coordinator
6) Hire caterer
7) Secure youth performers
8) Design invitations
9) Send out invitations
10) Invite media
11) Identify business leader
12) Invite CBOs to exhibit
F) SUPPORT OTHER PROJECT MY TIME STRATEGIES
1) Craft updates for political
candidates (city leaders)
2) Develop background materials and invitation to Advisory
Council (city leaders)
3) Develop update (or introduction) to DCPS administrators
and teachers (pilot program)
4) Support community outreach
at pilot sites (pilot program)
5) Support showcase events at
pilot sites (pilot program)
JUN-07
MAY-07
APR-07
MAR-07
FEB-07
JAN-07
DEC-06
NOV-06
OCT-06
SEP-06
AUG-06 (or before)
INPUT/APPROVAL
PHASE I
LEAD RESPONSIBILITY
67
APPENDIX E: BONNIE CLAC BUSINESS PLAN
FOR GROWTH
The Bonnie CLAC Business plan was developed by Root Cause
Senior Consultant Andrew Wolk with Root Cause Consultants Larry
Chait, Abby Fung, and Whitney Robbins in partnership with Bonnie
CLAC CEO Robert Chambers and the Bonnie CLAC working group:
Mary Burnett, Allan Ferguson, Robert E. Field, Sr., Leo Hamill, Jr., Robert G. Hansen, David Reeves, Rick Sayles, and Liz Sundee.
Root Cause is grateful to Bonnie CLAC for their willingness to share
this plan for the benefit of other organizations working to advance innovation for social impact.
Appendix E: Bonnie CLAC Business Plan for Growth
Business Plan for Growth
2008–2012
Robert Chambers
President & Co-Founder
Lebanon, NH
www.bonnieclac.org
Prepared By
The components of this business plan have been submitted on a confidential
basis. It may not be reproduced, stored or copied in any form. By accepting
delivery of this plan, the recipient agrees not to copy, fax, reproduce or
distribute without permission.
© Copyright Bonnie CLAC™ All rights reserved
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CONTENTS
EXECUTIVE SUMMARY ................................................................................... 73
I. NEED & OPPORTUNITY ............................................................................. 80
Figure A: 2005 US Car Market Sales in Units ........................................83
Table A: Characteristics of US Low-Income Car Ownership
Programs ..............................................................................................................85
Table B: Nonprofit Car Market Competitive Landscape ...................86
Table C: Annual Cost of Bonnie CLAC New Car vs.
“Buy-Here, Pay-Here” Used Cars ..............................................................89
II. SOCIAL INNOVATION IN ACTION:
THE BONNIE CLAC OPERATING MODEL
..................................... 92
Figure B: The Bonnie CLAC Program Model..........................................92
III. BONNIE CLAC’S GROWTH STRATEGY............................................ 96
Figure C: Bonnie CLAC Social Impact Model .........................................97
Figure D: Social Innovation Matrix .............................................................99
Figure E: Bonnie CLAC Organizational Model .......................................99
Table D: Goals by Phase .............................................................................. 100
Table E: Annual Outcomes.......................................................................... 101
Table F: Bonnie CLAC Start-up District Office Operations ........... 104
Table G: Very Low to Moderate Income Households in
MA & ME ............................................................................................................. 105
Figure F: District & Satellite/Hub & Spoke Expansion Model ..... 106
Table H: Number of Very Low to Moderate Income
Households by US State ............................................................................... 112
IV. TEAM & GOVERNANCE .......................................................................... 112
Figure G: Bonnie CLAC National Organization Chart ...................... 113
Figure H: Bonnie CLAC Phase I District Organization Chart ........ 118
V. TECHNOLOGY ............................................................................................... 122
VI. MARKETING ................................................................................................ 125
Table I: Historical Profile of a Successful Bonnie CLAC Client . 127
VII. STATE AND NATIONAL PARTNERSHIPS ................................... 131
VIII. FINANCIAL SUSTAINABILITY ........................................................ 132
Table J: National Office Budget and Capitalization Required...... 132
Table K: New District Financial
............................................................... 133
Table L: Number of District Clients & Alumni.................................... 133
Table M: Required Pipeline Conversion Rates................................... 133
Table N: Bonnie CLAC Program Fees .................................................... 133
Table O: Number of New Hampshire Flagship District
Clients & Alumni ............................................................................................ 133
Table P: New Hampshire District Financial Snapshot ................... 133
Table Q: National Financial Snapshot .................................................... 133
Figure I: Possible Bonnie CLAC 20-Year Financial
Sustainability Trajectory (2007-2027) .................................................... 133
IX. MEASUREMENT & QUALITY SYSTEM .......................................... 133
Table R: Bonnie CLAC Organizational-Health and
Program-Performance Indicators .......................................................... 136
Table S: Bonnie CLAC Social and Economic Impact Indicators .. 137
X. PUBLIC POLICY ........................................................................................... 140
XI. RISKS & EXTERNALITIES.................................................................... 142
XII. ACTION PLAN
.......................................................................................... 143
APPENDICES...................................................................................................... 144
Appendix 1—Bonnie CLAC Recognition and Awards....................... 144
Appendix 2—Client Testimonials............................................................. 145
Appendix 3—Districts and Offices ........................................................... 147
Appendix 4—Bonnie CLAC Pipeline Process ..................................... 147
Appendix 5—Social Impact Model
.......................................................... 151
Appendix 6—Training Manual (Removed for Publication) ............ 152
Appendix 7—Selecting a District Site .................................................... 152
Appendix 8—The Carsey Institute at the University of
New Hampshire Third Party Evaluation Preliminary
Interview Guide ................................................................................................ 154
Appendix 9—The Carsey Institute at the University of
New Hampshire Third Party Evaluation Preliminary
Interview Results ............................................................................................ 157
Appendix 10—The Carsey Institute at the University of New
Hampshire Third Party Evaluation Final Survey Instrument....... 161
Appendix 11—Biographies of Board of Directors and
Advisory Board................................................................................................. 166
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Appendix 12—Chief Executive Officer Job Description .................. 169
Appendix 13—Bonnie CLAC Cars™ System Functions .................. 172
Appendix 14—Marketing Road Map
(Removed for Publication) .......................................................................... 172
Appendix 15—Bonnie CLAC Alumni Membership Program......... 173
Appendix 16—Sample Promotional Flyer
Appendix 17—Corporate Partnership Package................................. 174
Appendix 18—Target Partnerships
....................................................... 174
Appendix 19—Committed and Targeted Philanthropy
Appendix 20—National Financial Model and Notes
Appendix 21—District Start-up Financial Model and Notes
Appendix 22—New Hampshire District Model and Notes
Appendix 23—Social and Economic Indicator Dashboard
(Removed for Publication) ........................................................................ 178
EXECUTIVE SUMMARY
Founded in 2001, Bonnie CLAC is the only nonprofit car organization in the country that uses a comprehensive program to help very low
to moderate income people establish positive credit so they can purchase
new, reliable, and fuel-efficient cars at affordable prices. The program
saves a client over $10,000 over the five-year period of the loan while
also achieving a positive impact on the client’s work, life, and health all
while contributing to a more sustainable environment. On average, the
program reduces carbon emissions by 36 metric tons of CO2 per person
over the life of the car.1
Bonnie CLAC is headquartered in Lebanon, New Hampshire, and
operates a central district office with five satellite locations around
the state. Since inception, Bonnie CLAC has financed 930 new cars,
served 827 people, and arranged for over $13 million in loans, with a
default rate of only 4%.2 Bonnie CLAC has already saved alumni of the
program over $1.8 million and will save them over $9 million over the
course of their loans.
Bonnie CLAC guides the very low to moderate income consumer
through the car-buying process from start to finish. It provides counseling, teaches financial literacy classes, and guarantees car loans at
wholesale interest rates to consumers who would not otherwise qualify
for them to finance brand-new Honda Civics, Toyota Corollas, and
other cars that suit the clients’ needs. Bonnie CLAC instituted the very
first, and to-date only, lending relationship between a financial institution and a nonprofit organization to provide wholesale financing rates
to very low to moderate income consumers.3 In just six years, Bonnie
CLAC has established itself as the premiere nonprofit car program in
the country.4
Bonnie CLAC has now begun work on expanding throughout New
England leading toward nationwide expansion. Bonnie CLAC’s goal is
1 http://www.stopglobalwarming.org/carboncalculator.asp?c=2;
Assumes 10-year life span
2 www.bonnieclac.org and from the Bonnie CLAC QuickBase database.
3 From Bonnie CLAC.
4 See awards and prizes listed at http://www.bonnieclac.org/about/
Program outcomes results are also available via a third-party evaluation performed by
Sally Ward and Sarah Savage. “Bonnie CLAC Interview Analysis.” Carsey Institute,
University of New Hampshire, Fall 2007.
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to make its services available to the tens of millions of very low to moderate income consumers across the United States who are still suffering
from the consequences of expensive, unreliable automobiles. Over the
next five years, Bonnie CLAC will establish 25 new districts, and expand its impact in the following ways:
PHASE I
2008
PHASE II
2009
2010
2011
2012
Annual Clients Served 280
474
963
1,875
3,485
Annual Client Savings $560,000
$948,000
$1.9mm
$3.8mm
$7.0mm
Annual Loans
Guaranteed
$4.2mm
$7.1mm
$14.4mm
$28.1mm
$52.3mm
CO2 Reduction
(metric tons)
1,016
2,736
6,231
13,034
25,681
In order to accomplish this, Bonnie CLAC is seeking $2.7 million to
support the first phase of the business plan expansion through 2008.
Need & Opportunity
According to the 2005 American Community Survey of the US
Census Bureau, there are 42.5 million very low to moderate income
households in the United States with incomes not exceeding $34,9995
making up approximately 17% of the total US population. In 2005, they
spent approximately $85 billion on used cars, comprising 24% of the
$353 billion used car market.6
When making car purchases, very low to moderate income households are faced with limited options. The lack of reliable cars at decent
financing terms for very low to moderate income households forces
them to purchase expensive, unreliable cars again and again, which result in dire work and credit consequences, poor health conditions, and
negative environmental impacts.7,8,9 According to an Aspen Institute re5 US Census Bureau. “2005 American Community Survey.” http://factfinder.census.gov/
servlet/DatasetMainPageServlet?_program=ACS&_submenuId=&_lang=en&_ts=
6 Automotive News Data Center, CNW Marketing/Research and ADESA Analytical
Services. 42.5 million very low to moderate income households divided by four (a
quarter of households purchase cars each year) = 10.6 million very low to moderate
income households * $7,998 (average price of used car) = $85 billion.
7 Goldberg, Heidi (Nov 2001). “State and County Supported Car Ownership Programs
Can Help Very low-Income Families Secure and Keep Jobs.” Center on Budget and
Policy Priorities. http://www.nedlc.org/center/Jump_start.pdf
8 Blumenberg, Evelyn (2002). “On the Way to Work: Welfare Participants and Barriers
to Employment,” Economic Development Quarterly, 16(4): 314-325. http://www.
nedlc.org/center/copc/otherresources/On_the_way_to_work.pdf
9 Raphael, Steven and Lorien Rice, “Car Ownership, Employment, and Earnings,” National
Science Foundation, SBR-9709197 and the Joint Center for Poverty Research. http://www.
jcpr.org/wpfiles/RaphaelSG2000.pdf?CFID=7752296&CFTOKEN=35709093
port, 90% of very low to moderate income households purchase vehicles
that are “bad, vastly overpriced, and wildly over financed”10 while the
remaining 10% do not even own a car.11
In the 21st century, owning a car has become more important than
ever.12 Job locations have shifted away from urban areas so that three-quarters of jobs are located in the suburbs,13 while many very low to moderate
income Americans live in metropolitan or rural areas without benefit of
public transportation.14 Congresswoman Gwendolynne S. Moore (D-WI),
a member of the Financial Services and Small Business Committee in
the US House of Representatives, said, “For many low-income families,
getting to a job can be even harder than getting hired in the first place.
Entry-level jobs of low-income workers are increasingly found in the faraway plants, warehouses, strip malls, and office parks of suburbia.”15
Over the past six years, Bonnie CLAC has developed and refined
a comprehensive car purchase program to help very low to moderate
income consumers successfully obtain new, reliable, and fuel-efficient
cars at affordable prices. Bonnie CLAC’s program is differentiated and
successful for the following five reasons:
1. A focus on new cars
2. Guaranteed financing at wholesale interest rates through unique
partnerships with financial institutions (currently 6.84%)
3. Assistance in establishing (or re-establishing) a positive credit
rating
4. Comprehensive support of the car-buying process from beginning
to end
5. Promotion of fuel-efficient vehicles
10 Sutton, Remar (Apr 2007). “Car Financing for Very Low and Moderate Income Consumers.” The Consumer Task Force for Automotive Issues and the Aspen Institute: 14.
11 Blumenberg, Evelyn. “Transportation and Very low Income Households.” http://www.
brookings.edu/es/events/20051205_Blumenberg.ppt#16
12 (In 2000, fewer than 5% of workers took public transportation to work, while nearly
88% commuted by car.)
Waller, Margy (Dec 2005). “High Cost or High Opportunity Cost? Transportation
and Family Economic Success.” The Brookings Institution Policy Brief. http://www.
brookings.edu/es/research/projects/wrb/publications/pb/pb35.htm
13 Waller: 3.
14 Waller: 3.
15 Moore, Gwendolynne S. (May 2005). “Press Release for US House of Representatives.”
http://www.house.gov/list/press/wi04_moore/pr120505.html
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The Bonnie CLAC Operating Model
Bonnie CLAC’s proven operating model utilizes a seven-step process.
The seven steps are:
1. Recruiting
2. Screening
3. One-on-One Counseling or FastTrack
4. Vehicle Selection
5. Financing
6. Delivery of a New Car
7. Alumni Support
Throughout the process, Bonnie CLAC Client Consultants meet regularly with clients to provide step-by-step guidance. This one-on-one
relationship, and the trust that results from this close bond, makes Bonnie CLAC unique and effective in working with this often-challenging
population. Other personnel involved in the process include an Intake
Manager who screens calls, a Financial Fitness Instructor who teaches
financial literacy classes, a BRIDGE Manager who provides transitional
loaner cars to clients who need them while they complete the program,
and a Delivery Manager who supports car selection, completes the necessary financing paperwork and manages the delivery of the new car
upon program completion. Bonnie CLAC’s comprehensive process has
enabled it to improve the lives of the New Hampshire residents it has
served16 while maintaining a loan default rate of only four percent.17
16 Ward, Sally and Sarah Savage. “Bonnie CLAC Interview Analysis.” Carsey Institute,
17 www.bonnieclac.org
Bonnie CLAC Strategies for Sustainability, Growth, & Impact
Over the next five years, Bonnie CLAC is committed to carrying
out a five-pronged strategy that will enable it to reach a greater percentage of the 42.5 million very low to moderate income households in
the United States. With stronger systems and infrastructure in place,
Bonnie CLAC will be ready to have significant and enduring impact in
making the ownership of new cars affordable to everyone in the targeted
population through guaranteed low interest loans. Bonnie CLAC’s fivepronged growth strategy is:
1. Establish districts that will become profitable and contribute
financially toward national operations
2. Develop the infrastructure needed to support national expansion
3. Implement a rigorous measurement & quality program
4. Develop state and national partnerships
5. Support public policies
Business Plan Timeline
Bonnie CLAC will use a phased approach to implement its business
plan, with the following goals defined for each phase:
PHASE I:
Launch four new districts
Piloting new districts
in select New England
states and building national support systems
Solidify national leadership team and
operations
Jan 2008–Dec 2009
(2 Years)
Build a robust measurement and quality
system
Establish initial state and national partnerships
Begin public policy work
PHASE II:
Testing growth of
districts nationwide
Jan 2010–Dec 2011
(2 Years)
Make necessary course corrections for
district model
Select sites and test district model beyond
New England
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PHASE III:
Scale Bonnie CLAC operations nationwide
Scaling
Nationwide
2012 (1+ Years)
Financial Sustainability
The foundation of Bonnie CLAC’s financial strategy is to operate
lean districts that will become profitable by efficiently capturing local
market share and successfully converting prospects to clients. Each
client contributes $1,065 in program fees, driving each new district to
profitability in Year 3 of operations. Bonnie CLAC has made the conscious decision not to raise client fees, as volume alone can make this
model sustainable over time. Bonnie CLAC will focus on partnerships
with banks, automobile manufacturers and rental car companies which
could also increase sustainability.
Below is a summary of the financials and investment required for the
entire span of the business plan. Bonnie CLAC has already raised $1.2
million toward national expansion. Bonnie CLAC is now seeking an additional $2.7 million in Phase I and an additional $9.6 million in Phase
II for a total capitalization of approximately $12.3 million over the next
five years. Approximately $4.3 million of the $12.3 million Bonnie
CLAC is raising will go toward launching 25 new district offices.
PHASE I: 2008-2009
PHASE II: 2010-2012
Total Expenses
$5,290,855
$20,429,965
Total Earned Revenues
$1,521,731
$10,743,530
Total Committed Funds Raised
to Date
$1,060,500
$125,000
Total Capitalization Required
$2,708,624
$9,561,435
Measuring Performance and Impact
The Carsey Institute at the University of New Hampshire recently
performed Bonnie CLAC’s first third-party evaluation of program outcomes, with many outstanding results.18 The preliminary data on 48 responses received and coded to date show the following:
Although relatively few respondents have actually changed their
jobs or earnings (10% and 17% respectively), getting to their jobs
and doing so punctually have improved (48% and 38%).
The majority of respondents report that their overall financial situation has improved (69%), and almost half are better able to pay
their bills. Respondents to date report spending less on gas (39%),
insurance (27%), repairs (75%), and interest rates (42%). In an independent analysis, the Root Cause Institute calculated that the average
Bonnie CLAC client saves over $2,000 a year, or over $10,000 over
the five-year lifespan of the average Bonnie CLAC car loan.19
The majority of respondents report being better able to provide
transportation for family members (56%), and many report improved ability to attend children’s activities (33%). Almost half
attend more community events, and three-quarters are in a better
position to shop and run errands.
Over half are better able to make health and dental appointments,
and over a third have greater options for purchasing food and for
health care.
In the future, Bonnie CLAC will measure the impact of its work in
the following three ways:
1. Implement indicators: Bonnie CLAC will assess the progress
and impact of its organization on an ongoing basis by implementing organizational and program-performance indicators and
social impact indicators. The social impact indicators are divided
into three categories to measure economic, health/lifestyle, and
environmental impact.
2. Implement measurement tools and tracking system: Bonnie
CLAC will build measurement tools and an organization-wide
tracking system that enables organizational-health and programperformance indicators to be automatically captured as part of
Bonnie CLAC’s daily operations. Social and economic indicators
will be collected via intake interviews, as well as from surveys
and/or interviews of alumni upon graduation, and 6, 12, and 18
months later.
19 See Table C on page 89: Annual Cost of Bonnie CLAC New Cars vs. Buy-Here, PayHere Used Cars in Bonnie CLAC Business Plan.
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3. Implement feedback and self-evaluation: Staff members will
analyze indicators on a regular basis to determine whether
Bonnie CLAC is meeting set goals and metrics. If it is not, appropriate action steps will be taken to remedy the problem(s).
In addition, Bonnie CLAC will hire a long-term third-party evaluator to track the longitudinal impact of its work. These efforts will
further validate the credibility of Bonnie CLAC’s program and enable
the organization to attract government and other funding support in
future years.
In five years, Bonnie CLAC will provide nationwide access to credit
at affordable interest rates and educational opportunities, so that very
low to moderate income individuals may obtain reliable and affordable
cars. Since its founding, Bonnie CLAC will have served 8,117 clients
throughout the United States, guaranteed nearly $121.8 million in
loans, and saved its clients more than $16.2 million. In addition, it will
have reduced carbon dioxide emissions by more than 52,000 metric
tons, the equivalent of taking 17,060 passenger cars off the roads for a
year or preserving 646 acres of forest from deforestation.20
I. NEED & OPPORTUNITY
Need
A. Social Problem
Very low to moderate income households are faced with limited options
when making car purchases, resulting in dire work and credit consequences,
poor health conditions, and negative environmental impacts.21,22,23 According to an Aspen Institute report, 90% of very low to moderate income
households purchase vehicles that are “bad, vastly overpriced, and wildly
over financed”24 while the remaining 10% do not even own a car.25
20 U.S. Climate Technology Corporation Gateway (http://www.usctcgateway.net/tool/)
21 Goldberg, Heidi (Nov 2001). “State and County Supported Car Ownership Programs
Can Help Very low-Income Families Secure and Keep Jobs.” Center on Budget and
Policy Priorities. http://www.nedlc.org/center/Jump_start.pdf
22 Blumenberg, Evelyn (2002). “On the Way to Work: Welfare Participants and Barriers
to Employment,” Economic Development Quarterly, 16(4): 314-325. http://www.
nedlc.org/center/copc/otherresources/On_the_way_to_work.pdf
23 Raphael, Steven and Lorien Rice, “Car Ownership, Employment, and Earnings,” National Science Foundation, SBR-9709197 and the Joint Center for Poverty Research. http://
www.jcpr.org/wpfiles/RaphaelSG2000.pdf?CFID=7752296&CFTOKEN=35709093
24 Sutton, Remar (Apr 2007). “Car Financing for Very low and Moderate Income Consumers.” The Consumer Task Force for Automotive Issues and the Aspen Institute: 14.
25 Blumenberg, Evelyn. “Transportation and Very low Income Households.” http://www.
brookings.edu/es/events/20051205_Blumenberg.ppt#16
While this population has limited access to a reliable car, having a
reliable car has become more important than ever.26 In the 21st century, three-quarters of jobs are located in the suburbs,27 while many
very low to moderate income Americans live in metropolitan or rural areas without benefit of public transportation.28 Congresswoman
Gwendolynne S. Moore (D-WI), a member of the Financial Services
and Small Business Committee in the US House of Representatives,
said, “For many low-income families, getting to a job can be even harder than getting hired in the first place. Entry-level jobs of low-income
workers are increasingly found in the faraway plants, warehouses, strip
malls, and office parks of suburbia.”29
The US Department of Housing and Urban Development (HUD)
defines very low to moderate income households as those households
earning an annual income not exceeding 80% of an area’s median income (AMI). Area median incomes vary by county and state, but the
US median household income in 2005 was $46,242.30 Therefore, the
upper limit for very low to moderate income households of four in the
US is an annual income not exceeding $36,994 (or 80% of $46,242).31
According to the 2005 American Community Survey of the US Census
Bureau, there are 42.5 million very low to moderate income households
in the United States with incomes not exceeding $34,999,32 making up
approximately 17% of the total US population. In 2005, they spent approximately $85 billion on used cars, comprising 24% of the $353 billion
used car market.33 This means a significant number of US households
are stuck with transportation options that seriously limit their ability to
26 (In 2000, fewer than 5% of workers took public transportation to work, while nearly
88% commuted by car.) Waller, Margy (Dec 2005). “High Cost or High Opportunity
Cost? Transportation and Family Economic Success.” The Brookings Institution Policy
Brief. http://www.brookings.edu/es/research/projects/wrb/publications/pb/pb35.htm
27 Waller: 3.
28 Waller: 3.
29 Moore, Gwendolynne S. (May 2005). “Press Release for US House of Representatives.”
http://www.house.gov/list/press/wi04_moore/pr120505.html
30 US Census Bureau. “2005 American Community Survey.” http://factfinder.census.gov/
31 Very low income is defined by the federal government as 30% of an area’s median income
(AMI), low income is defined as 50% of AMI, and moderate income is defined as 80%
of AMI. http://www.hud.gov/offices/cpd/systems/census/lowmod/index.cfm Based on the
US median household income from the 2005 Census, the very low income upper limit is
$13,873; the low income upper limit is $23,121; and the moderate income upper limit is
$36,994. To calculate income limits for families larger or smaller than four, increase the
limit by 8% for each person above four or reduce it by 10% for each person below four.
http://www.hud.gov/offices/cpd/systems/census/lowmod/calculation.cfm
32 US Census Bureau. “2005 American Community Survey.” http://factfinder.census.gov/
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lead productive and healthy lives and contribute to high levels of carbon
emissions.
B. Root Cause
Very low to moderate income households have limited options when
making car purchases because they lack the knowledge, resources, negotiating skills, and consumer credit scores necessary to access affordable
interest rates. For the most part, remedies to correct these problems—in
the form of education, advice, and financing—are unavailable to very
low to moderate income consumers.
In desperation, consumers in this income category turn to “buy-here,
pay-here” used car dealers, who do not require credit checks, a good
credit history, or a minimum credit score. Unfortunately, these used car
dealerships often take advantage of their desperate clientele by inflicting high prices, high interest rates, and large down payments. Ralph
Nader calls these practices “consumer oppression…and servitude.”34 In
addition to the onerous financial burden, used cars break down much
more frequently, often require more expensive repairs, consume larger
amounts of gasoline, release more carbon emissions, and carry only
slightly lower insurance costs than newer, more fuel-efficient cars. It is
not unusual for very low to moderate income households to have used
car loan obligations outstanding even after their cars have broken down
and can no longer function as transportation.35
The lack of reliable cars at decent financing terms for very low to
moderate income households forces them to purchase expensive, unreliable cars again and again, which contribute to a downward spiral of
poverty. In The Working Poor: Invisible in America, David K. Shipler, a
Pulitzer Prize winning New York Times reporter and university lecturer,
writes, “A run-down apartment can exacerbate a child’s asthma, which
leads to a call for an ambulance, which generates a medical bill that cannot be paid, which ruins a credit record, which hikes the interest rate on
an auto loan, which forces the purchase of an unreliable used car, which
jeopardizes a mother’s punctuality at work, which limits her promotions
and earning capacity, which confines her to poor housing.”36
34 Meredith, Robin. “Auto Dealer Has an Offer for Drivers with Bad Credit, but There’s a
Catch.” New York Times. 30 Aug. 1999.
35 Compiled from Bonnie CLAC Client Consultants anecdotes and Meredith, Robin.
“Auto Dealer Has an Offer for Drivers with Bad Credit, but There’s a Catch.” New
York Times. 30 Aug 1999.
36 Lacayo, Richard. “Take This Job and Starve.” Time. 9 Feb. 2004: http://www.time.
com/time/magazine/article/0,9171,588868,00.html. See also The Working Poor: Invisible
in America by David K. Shipler (New York: Vintage Books, 2005).
Environmental Landscape
C. The For-Profit Car Market
Figure A: 2005 US Car Market Sales in Units
For Profit
New Cars
28%
For Profit Used Cars
72%
The American car market is a $777 billion annual business. In 2005,
17.0 million new cars were sold in the United States, totaling $424 billion and making up 28% of the units sold (see Figure A).37 Most very
low to moderate income consumers do not even consider going to new
car dealerships to purchase a new car because they don’t think they’ll
be able to afford it.
Instead, they go to one of more than 100,000 used car dealerships in
the United States.38 In 2005 used car dealerships sold 44.1 million cars,
totaling $353 billion and making up 72% of the units sold.39
“Buy-here, pay-here” dealerships charge substantial down payments
for used cars that have short lifespans. In addition, they exercise predatory, though legal, lending practices, charging up to 25% interest on
monthly car payments.40 While used car dealers may tell consumers that
they “‘work with many different banks and…will give you the best interest [rate] for which you qualify’…this is serious misinformation,” says
Robert Chambers, co-founder of Bonnie CLAC. “The finance manager
will choose the bank that pays the dealership the most profit.”41
37Automotive News Data Center, CNW Marketing/Research, and ADESA Analytical
Services.
38 Sutton: 16.
39 Automotive News Data Center, CNW Marketing/Research, and ADESA Analytical
Services.
40 “Buy Here, Pay Here Industry Benchmarks,” prepared for the National Alliance of Buy
Here, Pay Here Dealers, Shilson, Goldberg, Cheung and Associates, L.L.P., http://www.
kenshilson.com
41 Vogel, John H. Jr. (Mar 2005). “Bonnie CLAC Case Study.” Tuck School of Business at
Dartmouth: 2-3.
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In addition to profit on a sale, when they originate a loan, car dealers
make both a flat fee and a premium tied to any markup on the interest
rate.42 Therefore, it is not unusual for car dealers to mark up the loan
three to five percentage points above the actual rate of the loan in order
to increase their profit margins.43 Using these tactics, used car dealerships can make as much as $3,500 gross profit on the sale of a single
used car.44
According to the Consumer Federation of America, “Consumers who
finance at the dealership are shown a document with a rate, but they are
never told that the rate has been arbitrarily marked up by the dealer and
that they could do better, given their creditworthiness. Similar practices
in home mortgage lending have been outlawed.”45
D. The Nonprofit Car Market
In recent years, increased social awareness of the many unfair and
unethical business practices of the for-profit car market has led to the
creation and growth of a nonprofit car market. The National Economic Development and Law Center’s Low-Income Car Ownership
(LICO) Clearinghouse has identified 151 LICO Programs in active
operation around the country.46 One hundred and eight organizations
responded to a survey administered by the Center in Summer 2006,
which allowed the Center to identify some key characteristics of the
nonprofit car market (see Table A).47 While substantial growth has
taken place in the number of nonprofit car programs in the past few
years, cars obtained through these programs still make up less than 1%
of the overall US car market.
42 Ibid.
43 Consumer Federation of America (Jan 2004) “The Hidden Markup of Auto Loans,”
www.consumerfed.org: 6.
44 Interview with Robert Chambers.
45 Consumer Federation of America: 5.
46 Lohrentz, Tim (Jun 2007). “Low-Income Car Ownership Programs—2006 Survey.”
National Economic Development & Law Center for the Annie E. Casey Foundation:
4. http://www.opportunitycars.com/Articles/LICOreport.pdf
47 Lohrentz: 4 (Function): 6 (Size & Reach)
Table A: Characteristics of US Low-Income Car Ownership Programs48
LOW-INCOME CAR OWNERSHIP PROGRAMS IN THE UNITED STATES
Size Most programs are small, regionally focused, and new.
Median annual budget—$126,000
39% have one staff person or less
Median number of cars distributed per year—35
Median start year—2000
Reach LICO organizations are spread throughout the United States.
Organizations exist in 33 of 50 states.
Highest number in New York, Minnesota, Pennsylvania, and Wisconsin
Function Most serve as financiers or acquirers/distributors.
46% of all nonprofit car organizations finance cars and
44% acquire and distribute them.
The remaining 10% consists of Individual Development Account (IDA) matched savings programs.48
E. The Nonprofit Car Market Landscape
The nonprofit car market consists of nonprofit organizations that help
disadvantaged consumers obtain used or new cars. The nonprofit used
car market can be divided further into organizations with functional expertise in financing as opposed to those with expertise in acquisition and
distribution. Table B presents a profile of three types of organizations
active in the nonprofit car market: 1) a nonprofit used car financier, 2)
a nonprofit used car acquirer & distributor, and 3) a nonprofit new car
financier and counselor.
48 In recent years, Individual Development Accounts (IDAs) have become popular as an
asset-building strategy for low-income individuals. IDAs are income-eligible savings
accounts that are matched anywhere from a 1:1 to a 4:1 ratio from a combination of
private and public sources.
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Table B: Nonprofit Car Market Competitive Landscape
Criteria
Ways to Work
Good News Garage
Bonnie CLAC
Type of
Organization
Nonprofit Used
Cars
Nonprofit Used Cars
Nonprofit New Cars
Relationship
to Vehicle
Financier
Acquirer &
Distributor
Financier &
Full-Service Counselor
Type of Cars
Used Cars
Donated, used cars
New Toyota Corollas, Honda Civics, &
other clientappropriate vehicles
Financing
Mechanism
Foundations and
banks provide
program-related
investment into a
loan pool fund
None; cars are either Partners with finangiven away or sold for cial institutions that
a small fee
provide loans
Number of
Offices
45 in 25 states
3 in New England
6 in NH
1996
2001
Burlington, VT
Lebanon, NH
Year Founded 1984
HQ
Milwaukee, WI
1. Nonprofit Used Car Market
Cars obtained through nonprofit used car organizations number
approximately 24,000 a year.49 Some organizations focus strictly on financing used cars, while others acquire used cars, fix them up, and then
distribute them to the needy.
Ways to Work affiliate offices make up roughly 70% of the nonprofit
financiers.50 Ways to Work was founded in 1984 by the McKnight Foundation in Minnesota. Since inception, Ways to Work has financed over
10,000 loans exceeding $21 million.51 Today, it operates 45 offices in 25
states and is a federally-certified Community Development Financial Institution (CDFI) headquartered in Milwaukee, Wisconsin. Ways to Work
partners with the Alliance for Children and Families to establish its offices
within new Alliance sites. At the local level, the program is administered
by a loan officer, who receives technical assistance and oversight from
49 Sutton: 16.
50 Lohrentz: 12.
51 http://www.waystowork.com/pages/p_hstry-milestns.html
Ways to Work.52 Ways to Work partners with foundations and banks to
provide a loan pool fund from which to finance modestly-priced used vehicles for needy families.53 However, Ways to Work does not assist its loan
recipients with other steps of the car purchase process.
Good News Garage is a prime example of an acquirer and distributor.
Good News Garage began in Burlington, Vermont, in 1996 as a community garage “where even poor people could buy a car that would be
in working condition and safe to drive.”54 Good News Garage solicits
donated cars, fixes them up, and then gives them away to recipients of
Temporary Assistance to Needy Families (TANF) or sells them for a
small fee to low-income applicants sponsored by local church and civic
groups. Since its founding in 1996, Good News Garage has helped over
2,000 individuals and families.55 Today, Good News Garage, in partnership with Lutheran Social Services of New England, operates three
community garages in the New England region.
2. Nonprofit New Car Market
Founded in 2001, Bonnie CLAC is the only nonprofit car organization
that utilizes a comprehensive program to help very low to moderate income consumers establish positive credit ratings so they can purchase new,
reliable, and fuel-efficient cars at affordable prices. Bonnie CLAC guides
the very low to moderate income consumer through the car-buying process from start to finish. It provides counseling, teaches financial literacy
classes, and guarantees car loans at wholesale interest rates to consumers
who would not otherwise qualify for them to finance brand-new Honda
Civics, Toyota Corollas, and other cars that suit the clients’ needs. Bonnie
CLAC instituted the very first, and to-date, only, lending relationship between a bank and a nonprofit organization in order to provide wholesale
financing rates to very low to moderate income consumers.56
Bonnie CLAC is headquartered in Lebanon, New Hampshire, and
operates in six locations around the state. Since inception, Bonnie
CLAC has financed 930 new cars, served 827 people, and arranged for
over $13 million in automobile loans with a default rate of only 4%.57
52 http://waystowork.org/pages/p_business-model.html
53 2006 Evaluation of the national Ways to Work program from www.waystowork.org
54 http://www.goodnewsgarage.org/about_us/
55 Primack, Phil. (Winter 2006). “Want to Give Away That Old Jalopy? Here’s Good
News.” CommonWealth: 15. http://www.goodnewsgarage.org/about_us/media_coverage/
56 From Bonnie CLAC.
57 www.bonnieclac.org and from Bonnie CLAC QuickBase database.
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Opportunity
Over the past six years, Bonnie CLAC has developed and refined a
comprehensive car purchase program to help very low to moderate income consumers successfully obtain new, reliable, and fuel-efficient cars
at affordable prices. For a one-time cost of approximately $865 per client,58 Bonnie CLAC can potentially save that client more than $10,000
over the course of his or her five-year loan payment period (see Table C
below) while bringing about many positive, long-term social, economic
and environmental impacts (discussed in greater detail in Section IX of
this business plan).
In addition to a successful program model, Bonnie CLAC has also developed a successful operational model. A local Bonnie CLAC district
office can be financially profitable within a few years after its launch
and help contribute to the expenses of running a national office. After
proven success in New Hampshire, Bonnie CLAC is ready to scale this
program nationwide. Bonnie CLAC has developed this business plan
into a roadmap for remedying the reliable transportation problem for
millions of very low to moderate income individuals, in order to help
them lead more productive and healthy lives.
Bonnie CLAC’s program is differentiated and successful for the following five reasons: 1) a focus on new cars, 2) guaranteed financing at
wholesale interest rates, 3) assistance in establishing (or re-establishing)
a positive credit rating, 4) comprehensive support of the car-buying process from beginning to end, and 5) promotion of fuel-efficient vehicles.
1. A Focus on New Cars
New cars break the cycle of poverty by requiring fewer repairs,
providing greater safety and reliability, and creating economic self-sufficiency for the owner. According to Table C below, a new car can
save a Bonnie CLAC client over $2,000 each year, compared to a used
car from a “buy-here, pay-here” dealership. For a household earning
$20,000 a year, this represents 10% of their total salary that could be
spent on other critical needs.
58 From Bonnie CLAC.
Table C: Annual Cost of Bonnie CLAC New Car vs. “Buy-Here, Pay-Here” Used Cars
[1] Provided by Bonnie CLAC
[2] “Buy Here, Pay Here Industry Benchmarks,” prepared for the National Alliance of Buy Here, Pay
Here Dealers, Shilson, Goldberg, Cheung and Associates, L.L.P; http://www.kenshilson.com
[3] A Bonnie CLAC car takes five years to pay off.
[4] http://www.edmunds.com/advice/buying/articles/47079/article.html
[5] Annual fuel cost for 2007 Toyota Corolla, www.fueleconomy.gov based on 45% highway driving, 55%
city driving, 15,000 miles/year and $2.80 per gallon.
[6] Annual fuel cost for 1998 Subaru Legacy, www.fueleconomy.gov based on 45% highway driving, 55%
city driving, 15,000 miles/year and $2.80 per gallon.
[7] Kelley Blue Book trade-in value, 2002 Toyota Corolla, 75k miles, good condition
2. Financing Partnerships at Wholesale Interest Rates
By serving as a financing guarantor, Bonnie CLAC makes car loans available to very low to moderate income individuals at lower rates than they
could access as individuals. Both for-profit used car dealerships and other
nonprofit car organizations tend to provide financing at higher interest rates
than Bonnie CLAC because used cars have higher interest rates than new
cars. Because banks are concerned about the value of loan collateral, they
want to be paid a significant premium for older cars.59 Therefore, the older
59 Vogel: 4.
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the car, the higher the interest rate the bank will charge for car loan financing. While Bonnie CLAC provides wholesale interest rates for new
automobiles at 6.8%, used car interest rates can start at 9% and run as high
as 25% for “buy-here, pay-here” used car dealerships.60,61
In addition, Bonnie CLAC is able to offer consistently low interest rates
regardless of the number of transactions conducted annually, because it
does not rely on loan funds to provide financing, which can limit the number of transactions nonprofit car financiers are able to conduct.
3. Credit Rating Rehabilitation
Bonnie CLAC not only helps very low to moderate income individuals obtain financing to purchase cars, but it also helps them repair their
credit and establish (or re-establish) a positive credit rating. Based on a
client’s individual credit history and ability to make payments, a Client
Consultant will perform a one-on-one credit analysis and determine the
most appropriate credit counseling for that client. Client Consultants will
give clients “assignments” toward credit repair and (re)establishment of a
positive payment history. Bonnie CLAC helps its clients rehabilitate their
credit ratings and establish positive financial habits and ways of thinking
that will last well beyond the transaction of a car purchase.
4. Comprehensive Car Buying Support from Soup to Nuts
Many very low to moderate income households also lack the critical
knowledge, resources, and negotiating skills needed to obtain good cars
at affordable prices. Bonnie CLAC provides one-on-one counseling, financial literacy education, access to a temporary car through a BRIDGE
program, guidance in making car purchase decisions, and assistance in executing car purchase processes. By guiding its clients step by step through
the car buying process, and maintaining regular contact throughout the
duration of the car loan to provide further troubleshooting and guidance
as necessary, Bonnie CLAC has been able to maintain an exceptionally
low default rate of 4%, compared to 15% for Ways to Work, and up to
40% for “buy-here, pay-here” used car dealerships.62,63,64
60 Meredith, Robin.
61 Vogel: 4.
62 “Enterprising Ideas: Lending a Hand.” NOW. Host David Brancaccio. Public Broadcasting System. 22 June 2007. http://www.pbs.org/now/transcript/325.html
63 From Ways to Work http://www.waystowork.com/documents/Evaluations/WtW_reference_book.pdf
64 Associated Press. “Devices Can Halt Cars with Tardy Payments.” Billings Gazette. 10
April 2005. http://www.billingsgazette.com/newdex.php?display=rednews/2005/10/04/
build/business/45-halt-cars.inc
5. Promotion of Fuel-Efficient Vehicles
As more and more people require cars to get to work, fuel-efficient
vehicles are becoming essential in mitigating the impact of fuel emissions
and air pollution. The types of cars Bonnie CLAC finances—typically
Toyota Corollas and Honda Civics—have higher gas mileage, more efficient operating costs, and lower environmental impacts.65 For example,
a 1998 Subaru Legacy consumes 20% more gasoline, produces 20%
more in greenhouse emissions, and gets 20% fewer miles per gallon than
a 2007 Toyota Corolla.66 A Bonnie CLAC car reduces carbon emissions
by 36 metric tons of CO2 over the life of the car.
Bonnie CLAC has received many awards and prizes for its unique
and entrepreneurial program (See Bonnie CLAC Appendix 1 on page
144). In the past few years, Bonnie CLAC has been the subject of feature articles in the national media, including Time, Business Week, The
Wall Street Journal, and The Washington Post. Last year, it received The
Purpose Prize, a contest sponsored by Civic Ventures which received
more than 1,200 submissions nationwide.67 This year, Bonnie CLAC
was awarded the prestigious Manhattan Institute Award for Social Entrepreneurship.68
In just six years, Bonnie CLAC has established itself as the premiere
nonprofit car program in the country. It has improved the lives of the
New Hampshire residents it has served69 (See Bonnie CLAC Appendix
2 on page 146 for Client Testimonials). But there are 42.5 million very
low to moderate income households in the United States, and a quarter
of them purchase used cars each year, spending $85 billion at “buy-here,
pay-here” dealerships.70 Bonnie CLAC will use its national expansion to
reach this vulnerable population and help them save money and obtain
better, more reliable cars toward the overall improvement of their lives
and the overall improvement of the environment.
65 “Enterprising Ideas: Lending a Hand.” NOW. Host David Brancaccio. Public Broadcasting System. 22 June 2007. http://www.pbs.org/now/shows/325/index.html
66 http://www.fueleconomy.gov
67 http://www.purposeprize.org/index.cfm
68 http://www.manhattan-institute.org/html/social_entrepreneurship.htm
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II. SOCIAL INNOVATION IN ACTION: THE BONNIE
CLAC OPERATING MODEL
Bonnie CLAC Operating Model
Bonnie CLAC currently operates one district in Lebanon, New Hampshire, with five satellite sites located in Keene, Manchester, Concord,
Portsmouth, and Exeter (see Bonnie CLAC Appendix 3 on page 147).
Bonnie CLAC’s proven, comprehensive car-purchase program uses
a seven-step process to help its very low to moderate income clients
obtain reliable cars at affordable prices. The seven steps are: 1) Recruiting, 2) Screening, 3) One-on-One Counseling or FastTrack, 4) Vehicle
Selection, 5) Financing, 6) Delivery of a New Car, and 7) Alumni Support (see Figure B below).
Figure B: The Bonnie CLAC Program Model
Throughout the process, Bonnie CLAC Client Consultants meet regularly with clients to provide step-by-step guidance. This one-on-one
relationship, and the trust that results from this close bond, make Bonnie CLAC unique and effective in working with this often-challenging
population. Other personnel involved in the process include an Intake
Manager who screens calls, a Financial Fitness Instructor who teaches
financial literacy classes, a BRIDGE Manager who provides transitional
loaner cars to clients who need them while they complete the program,
and a Delivery Manager who supports car selection, completes the necessary financing paperwork and manages the delivery of the new car
upon program completion. For a detailed description of each step of the
process, see below or in Bonnie CLAC Appendix 4 on page 147.
1. Recruiting
Bonnie CLAC recruits prospects from the very low to moderate income community. Local offices work with social service agencies to find
prospective clients, partner with and make local company presentations,
and distribute flyers to spread the word about Bonnie CLAC.
2a. Screening I:
After an initial inquiry comes in, Bonnie CLAC’s Intake Manager
uses a short, telephone-based survey to determine whether the prospect
has at least $300 in disposable income after paying monthly expenses.
This screening process helps ensure that those who come in for a Client
Consultant interview have a good chance of enrolling and succeeding in
the Bonnie CLAC program.
2b. Screening II:
Prospects who are approved over the telephone are invited to come
to a local site and meet personally with a Client Consultant. They are
asked to bring income and expense statements with them so the consultant can verify whether they have sufficient disposable income to
meet monthly car, insurance, and gas payments. The goal of this meeting is to ascertain financial qualifications and to help prospects better
understand the program so they can decide whether or not to enroll.
Prospects who choose to enroll pay a $65 fee and become official Bonnie
CLAC clients.
3. FastTrack or Counseling:
As soon as a client enters the program, the enrolling Client Consultant becomes his/her counselor. The Client Consultant works with
the client to develop a customized plan that fits the client’s personal
financial status and situation. Clients with good to excellent credit records, stable employment, and residence history may enter FastTrack
and receive a new car almost immediately. Otherwise, clients begin
an intensive counseling program that includes credit repair, Financial
Fitness (FinFit) classes, and other needed assignments required by the
individual’s profile.
Credit Repair
Client Consultants perform one-on-one credit analysis to determine
the credit counseling appropriate for each client. The customized
clean-up plan is based on the client’s credit history and his/her ability
to make payments to creditors. Clients whose accounts are in collection can take 6-12 months to improve their credit history. During this
time, Client Consultants will give clients “assignments” toward credit
repair and (re)establishment of a positive payment history.
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» Credit repair assignments may include paying charged-off
loans, making plans to pay all regular monthly expenses (rent,
utilities, loans, etc.) on time, explaining medical charge-offs,
and identifying fraud or errors and correcting them.
» (Re)establishment of a positive payment history may include
the creation of a savings plan and/or enrollment in Bonnie
CLAC’s transitional BRIDGE car program.
During the savings plan, clients are required to deposit
$250-$285 per month into a savings account, with the purpose of demonstrating their ability to build this recurring
“expense” into their budget.
The BRIDGE program provides clients who need a
“bridge” loaner car with one at a cost of only $250 a
month. At the same time, clients improve their credit records by building a history of on-time, monthly payments.
The BRIDGE Manager places clients into this program,
lines up the necessary BRIDGE cars for them, collects
monthly payments, and conducts a review after two to
three months. The BRIDGE Manager also helps transition
BRIDGE clients into the next step of the program once
their credit records have been sufficiently repaired.
Financial Fitness (FinFit)71
Financial Fitness (FinFit) is a five-week financial literacy program
taught by a Bonnie CLAC FinFit Instructor. FinFit classes include
budgeting and financial goal setting, checking-account management, money-saving techniques, protecting and building a positive
credit history, and food economics and nutrition. Food economics
and nutrition is included as a topic of Financial Fitness because
Bonnie CLAC strives to help clients make economic shopping
choices and improve health outcomes. Financial Fitness teaches
clients to make sustainable changes in all aspects of their lives
by encouraging personal growth related to self-worth and status,
long-term planning and thinking, and the development of a healthy
relationship to money.
71 www.bonnieclac.org and through discussions with Bonnie CLAC’s FinFit Instructors.
The FinFit classes have a high satisfaction rate among students and have been praised
by local educators and officials.
4. Vehicle Selection:
The client and Client Consultant work together to select a vehicle
that is appropriate for the client’s budget, family size, and other needs.
This selection is usually a Toyota Corolla or a Honda Civic, although
other vehicles may be purchased with the approval of the Client Consultant. Bonnie CLAC’s focus is on financing fuel-efficient cars. This
goal helps combat fuel emissions and pollution even as it puts more
very low to moderate income drivers on the road. Once a vehicle has
been selected, the Client Consultant asks the Delivery Manager to
locate the vehicle.
5. Financing a Car:
Upon completing the program and selecting a car, the client is
now ready to purchase the car. The Client Consultant collects the
following information in order to advocate for the client in his/her
loan application.
Client’s length of time with Bonnie CLAC
Programs completed with Bonnie CLAC (Credit Repair, Savings
Plan, BRIDGE Program, Financial Fitness)
Time at job
Time at residence
Current vehicle/transportation source
Average weekly commute to work
Explanation of credit issues
Bonnie CLAC enables its clients to obtain wholesale financing rates
for their new car loans through partnerships with financial institutions.
Bonnie CLAC acts as guarantor for the car loan. Interest rates average around 6.8%, which is exceptionally low for this particular client
base.72 Once the loan is submitted and approved by the financial institution, Bonnie CLAC’s Delivery Manager completes the purchase
and sale documentation and the bank loan paperwork necessary for the
purchase of the new car. Clients sign a lease for a five-year loan, with
monthly payments of $250-$285. Each client also pays a one-time loan
72 Vogel: 4.
95
96
guarantor’s fee of $800 to Bonnie CLAC for financing and providing
support throughout the duration of the loan. This $800 is built into the
terms of the loan instead of coming directly out of the client’s pocket.
6. Delivery of a New Car:
When the loan has been funded and the money has been paid to the
car dealership, the Delivery Coordinator either accompanies the client
to the local dealership to pick up the new car, or arranges for the local
car dealership to drop it off.
7. Alumni Support:
Once Bonnie CLAC clients receive their new cars, they are known as
Bonnie CLAC alumni. Bonnie CLAC alumni are contacted periodically
by Client Consultants for follow-up and monitoring throughout the life
of the car loan. This includes information or assistance with:
Maintenance, repairs, warranties, and/or extended warranties
Disputes with insurance companies over unfair claim decisions
Communications with the financial institution regarding car loans
Ongoing financial fitness support and education
Discounts on new and used auto parts
Preparations for future car purchases
Financial Health
Bonnie CLAC’s comprehensive and holistic approach has proven it
can be a successful operating model. In 2006, 204 new car transactions
were completed by Bonnie CLAC. The district earned over $200,000 by
charging a $65 enrollment fee, an $800 car transaction fee, and a $200
loan origination fee for each car successfully provided.
However, Bonnie CLAC has reached only a small percentage of its
potential market, leaving ample room for growth. The rest of this business plan will focus on Bonnie CLAC’s five-year growth strategy.
III. BONNIE CLAC’S GROWTH STRATEGY
Figure C below summarizes Bonnie CLAC’s Social Impact Model,
which will guide the organization’s growth strategy over the next five
years. The model states the social problem that Bonnie CLAC addresses,
along with the organization’s mission in meeting that need. It goes on to
describe Bonnie CLAC’s operating model and sets forth Bonnie CLAC’s
five-pronged strategy to grow district by district across the country. Finally,
the Social Impact Model outlines the organizational, program performance, and social and economic indicators that Bonnie CLAC will track
to measure its success toward achieving the overall vision. The feedback
loop shows how Bonnie CLAC will continuously monitor the success of
its operating model and social impact strategies so it can make course corrections along the way. (For a more complete view of the Social Impact
Model, see Bonnie CLAC Appendix 5 on page 152.)
Figure C: Bonnie CLAC Social Impact Model
The foundation of the Social Impact Model is Bonnie CLAC’s core
mission, vision, and the five operational strategies that will guide its
activities.
MISSION
Bonnie CLAC enables very low to moderate income individuals to
purchase an affordable car, which results in improvements in their
lives and is consistent with maintaining a sustainable environment.
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98
VISION
One day, very low to moderate income people will have access to
credit at affordable interest rates and a variety of broadly available educational opportunities to obtain a selection of reliable and
affordable cars, which lead to improvements in their lives and is
consistent with maintaining a sustainable environment.
OPERATIONAL STRATEGIES
Establish profitable districts that will contribute financially
toward national operations
Develop the infrastructure needed to support national
expansion
Implement a rigorous measurement & quality program
Develop state and national partnerships
Support public policies
Choosing a Scale Strategy—The ‘Branch’ Model
The Bonnie CLAC operating model has been developed and tested
over time to ensure success. Replicating this model successfully requires
choosing the core elements of the plan while allowing other elements to
remain optional. The overall goal, particularly in Phase I, is to protect
the integrity and quality of the model while allowing for adjustments to
be made according to locality that will increase the chances of success.
Pathways to Social Impact: Strategies for Scaling Out Successful Social
Innovations, a paper from Duke University’s Center for the Advancement of Social Entrepreneurship, describes two key considerations
when developing a replication strategy: 1) what to replicate and 2)
how to replicate. Bonnie CLAC’s model is complex and comprehensive; therefore, it has chosen a branch model to ensure that the
model can be closely monitored and adjusted by the national office
during its initial replication phase (see Figure D). In addition, it has
chosen a branch model because there are great efficiencies that can
be gained from having many functions performed at the national
level to provide economies of scale and a greater chance for district
success73 (see Figure D).
73 Dees, J.G., Anderson, B. and Wei-Skillern, J. (Aug 2002). Pathways to Social Impact:
Strategies for Scaling Out Successful Social Innovations. Center for the Advancement of
Social Entrepreneurship, The Fuqua School of Business, Duke University.
Figure D: Social Innovation Matrix
As seen below in Figure E, each new Bonnie CLAC district will become part of Bonnie CLAC national. All the districts will operate along
the lines of the current Lebanon, New Hampshire, district, striving toward specific targets of operational efficiency and financial profitability.
The branch model provides Bonnie CLAC with the best path toward
building efficient operations and maintaining quality control, while
also improving model replication. The national office will continuously
monitor the replication of new districts to make course corrections or to
disseminate best practices.
Figure E: Bonnie CLAC Organizational Model
Bonnie CLAC
National Operations
District A
District B
District C
District D
Business Plan Timeline
The business plan is structured into three phases over five plus years.
Details in this business plan will focus on Phase I and cover two years,
from January 2008 to December 2009. The goals in each phase are listed
in Table D.
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100
Table D: Goals by Phase
PHASES
GOALS
PHASE I:
Launch four new districts
Piloting new districts in select
New England states and building national support systems
Solidify national leadership team
and operations
Jan 2008–Dec 2009 (2 Years)
Build a robust measurement and
quality system
Establish initial state and national
partnerships
Begin public policy work
PHASE II:
Testing growth of districts
nationwide
Jan 2010–Dec 2011 (2 Years)
PHASE III:
Scaling Nationwide
Make necessary course corrections
for district model
Select sites and test district model
beyond New England
Scale Bonnie CLAC operations
nationwide
2012 (1+ Years)
In Phase I, from January 2008 through December 2009, the current
Lebanon, New Hampshire, district will serve as Bonnie CLAC’s flagship
model district, to support the training and development of all future districts. Current national operations will also be strengthened to support
district growth. Four additional districts will be launched during Phase I,
with one new district each in Massachusetts and Maine. The remaining
two New England locations have yet to be determined based on further
information collected in 2008.
In Phase II, from 2010-2012, Bonnie CLAC will launch 21 new districts, completing its expansion across New England and beginning
nationwide expansion.
In Phase III, beyond 2012, Bonnie CLAC will scale districts across
the United States. It expects to launch districts at a rapid pace based on
knowledge gained and improvements made over the previous four years.
By the end of 2012, Bonnie CLAC will have a total of 26 districts
in operation. It will have provided 8,117 clients with new cars since its
founding, financed nearly $121.8 million in car loans, and saved clients
an estimated $16.2 million. In addition, it will have prevented more
than 78,800 metric tons of CO2 from being released into the atmosphere, the equivalent of taking 17,060 passenger cars off the roads for
a year or preserving 646 acres of forest from deforestation74 (see Table
E). In addition, Bonnie CLAC brings about many positive, long-term
social and economic outcomes, such as improvements to health, family,
personal well-being, wages, and credit scores, discussed in greater detail
in Section IX of this business plan.
Table E: Annual Outcomes
YEAR
20012007
2008
1
3
5
7
9
25
Total Number of
Districts
1
2
5
10
17
26
26
Number of
Clients Receiving
Cars
1040
280
474
963
1,875
3,485
8,117
$4.2mm
$7.1mm
$14.4mm
$948,000
$1.9mm
$3.8mm $7.0mm
6,880
10,483
13,608
Districts Opened
Amount of
Financing
Secured [1]
Savings by
Clients [2]
$2 mm
Carbon Reduc30,137
tion (metric tons)
5,080
2009
2010
2011
2012
Total
$121.8 mm
12,646
$16.2mm
78,834
[1] Assumes an average loan of $15,000.
[2] Annual savings calculated in Table C.
[3] Assumes Bonnie CLAC cars average an increase of 8 mpg over client’s previous car.
74 U.S. Climate Technology Corporation Gateway (http://www.usctcgateway.net/tool/)
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BUSINESS PLAN IMPLEMENTATION: OPERATIONAL GROWTH
STRATEGIES
Phase I Goal: Piloting New Districts in Select New England States
& Building National Support Systems, 2 Years (January 2008–December 2009)
A. Launch Four New Districts
Phase I Goal: Establish New Hampshire as the flagship district site
and pilot four additional districts, all working towards profitability and
contributing to the national office operational budget.
1. Establish New Hampshire as the Flagship District
New Hampshire will serve as the flagship district for Bonnie CLAC
operations. Some of the responsibilities of the flagship district include:
Documenting and fine-tuning the model for district operation
Developing training and operational manuals for other districts
(see Bonnie CLAC Appendix 6 on page 153)
Providing training to other district sites
Testing district innovations:
» Utilizing volunteers as client consultants
» Opening a satellite office in remote areas
» Outsourcing FinFit classes
Serving as the host model site for organizations or parties interested in launching a district office
2. Pilot Four New Districts
Using New Hampshire as a model, Bonnie CLAC has carefully
studied the best way to select a district site and grow it toward
profitability. Bonnie CLAC has created a district financial growth
model that will allow each new district to become profitable in
Year 4. This model uses the following key assumptions, which
were determined using Bonnie CLAC’s historical records:
a. Piloting a District
A Bonnie CLAC district will have the following growth in completed car transactions: Year 1) 25, Year 2) 80, Year 3) 200, Year
4) 300, Year 5) 400
75% of clients will come from very low to moderate income
households; 25% of clients will come from above moderate
income households
Clients will take an average of six months to go through the program
At full capacity, a Client Consultant can serve 140 clients per year
In order to ensure that a district can both fund district expenses
and eventually provide financial support for national operations,
Bonnie CLAC is setting clear targets for its marketing efforts.
Those assumptions are as follows:
» 75% very low to moderate income clients:
25% of households in a district are looking for a car
6% of that market will inquire about Bonnie CLAC each year
65% will pass the initial phone screen
35% of those who have a one-on-one interview will enroll
in the program
85% will complete the program and receive a new car
» 25% above moderate income households:
25% of households in a district are looking for a car
6% of that market will inquire about Bonnie CLAC each year
100% will pass the initial phone screen
100% who have a one-on-one interview will enroll in the
program
100% will complete the program and receive a new car
Based on these assumptions, a district requires a market of
approximately 60,000 very low to moderate income households and approximately 200 car transactions to become profitable in Year 3. By Year
5, a district that covers 120,000 very low to moderate income households and completes 400 car transactions will contribute over $80,000
to national operations (see Table F).
The social return on investment is quite impressive. For a $170,000
one-time investment in a new Bonnie CLAC district, approximately
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1,000 clients will receive new cars and save a cumulative $2,000,000
over five years (Table F). This figure does not even take into account
the many positive social and economic improvements to health, family, personal well-being, wages, and credit scores that accrue to Bonnie
CLAC alumni in the long term. (See Section IX for further discussion
of long-term outcomes).
Table F: Bonnie CLAC Start-up District Office Operations
Phase I
Phase II
2008
2009
2010
2011
2012
Revenues
28,840
93,136
225,900
337,028
447,710
Expenses
118,202
144,947
223,591
298,941
365,374
Net Income
(89,362) (51,811) 2,309
38,087
82,336
Total
Households
8,000
24,000
60,000
90,000
120,000
Car
Transactions
25
80
200
300
400
Client Savings
$50,000
$160,000 $400,000 $600,000 $800,000
3. Selecting and Locating Districts (Bonnie CLAC Appendix 7)
In Phase I, Bonnie CLAC will launch four new districts in the New
England region. To select the most promising states in which to locate
its prospective districts, Bonnie CLAC will use the following process:
a. Determine which states within each region have the highest number
of very low to moderate income households
(see Table H).
b. Determine which states have the greatest fundraising capability.
c. Determine which states have the greatest partnership support and
potential.
Using the process above, Bonnie CLAC has determined that its first
two new districts will be located in Massachusetts and Maine.
In locating the district office within a qualifying state, Bonnie CLAC
will use the following process:
a. Use HUD guidelines and the US Census to determine the cities that
have very low to moderate income populations of 120,000 households or more.75 Examples of cities in Massachusetts and Maine that
fit this criteria are shown in Table G below:
Table G: Very Low to Moderate Income Households in MA & ME
b. Determine which districts have the greatest fundraising capability.
At a minimum, a district office must be able to raise $100,000 in
start-up philanthropic funds to launch and an additional $70,000 in
the next 18 months.
c. Determine which districts have the greatest partnership support and
potential. Each district office must be supported by:
i.
2-3 social service and nonprofit referral agencies
ii. 2-3 corporations that hire or serve a population fitting Bonnie
CLAC’s target profile
iii. At least one organization that can teach high-quality financial
fitness classes
iv. At least one organization willing to provide in-kind office facilities for a start-up staff for the next two years
v.
1 financing bank (if necessary)
75 Note: Census information at the city level (called metropolitan statistical areas) can
be found using http://factfinder.census.gov/servlet/ADPGeoSearchByListServlet?ds_
name=ACS_2005_EST_G00_&_lang=en&_ts=200697026088
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d. Other criteria, such as distance to and from public transportation,
centrality of location, or political considerations, may be taken into
account at the discretion of the Regional Director and CEO.
Bonnie CLAC will locate the first new districts in areas close to its
current flagship district office in Lebanon, NH. It will use these new district offices to develop best practices and strengthen its ability to launch
additional districts in Phase II.
4. Expanding within a District
The district office in each state will serve as the central hub, and
satellite office sites will emanate as spokes from a hub (see Figure F
below). Satellite office sites may not have brick and mortar office facilities; instead, Client Consultants will operate mobilely, using a laptop, a
cellular phone, and an automobile.
Figure F: District & Satellite/Hub & Spoke Expansion Model
It is important to understand that there are expenses involved in
launching each new satellite location. Therefore, satellite locations will
be launched according to the following capacity guidelines:
1. Bonnie CLAC will add client consultants in a district only when
existing client consultant(s) in that district are operating at 80%
of capacity.
2. Bonnie CLAC will open additional satellite sites within a district
only when existing sites in that district have achieved 3% penetration of the relevant market area.
3. Bonnie CLAC will use the same criteria of market size and partnership potential in identifying potential satellite sites.
4. Bonnie CLAC will select those sites in closest proximity to existing
district and satellite offices as the next location for a satellite office.
5. When the district area has been saturated (i.e. approaching 400
car transactions per year), a satellite site may be re-aligned into a
new district that will now create its own new satellite offices.
B. Solidify National Leadership Team and Operations
Phase I Goal: Build a national leadership team that will put systems,
policies, and procedures in place, refine the marketing strategy, build an
alumni network, and utilize technology in order to build the highly-efficient operations required to scale nationally
Action areas in this phase will consist of the following five key areas
of activity:
1. Build a National Leadership Team
In Phase I, Bonnie CLAC will build a Senior Management Team,
consisting of a President, Chief Executive Officer, Chief Marketing Officer, Director of Measurement and Quality, and Director of Training and
Human Resources. Further descriptions of each position can be found
in the Team section (Section IV) of the business plan.
2. Put Systems, Policies, and Procedures in Place
In Phase I, Bonnie CLAC will put systems, policies, and procedures in
place so the organization is better positioned to scale. Areas to be analyzed and strengthened include: financial reporting; fundraising; legal
matters, including trademarks and contracts; and systems and communications between national and district offices and between district and
satellite offices.
Bonnie CLAC will test out three partnership options for scaling its
BRIDGE car program:
1. Bonnie CLAC will buy 10 good used cars (5 for the flagship
Lebanon, New Hampshire, district and 5 for the first new
district to be launched in Year 1) at $6,000 each, using a grant
from the New Hampshire Community Development Finance
Authority (CDFA). Monthly BRIDGE payments will be placed
into a fund for the purchase of replacement BRIDGE cars on a
periodic basis.
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2. Bonnie CLAC will develop and test a subleasing partnership
with a national car rental company (i.e. Enterprise, Avis, Budget,
Alamo, National, Dollar, Thrifty, or Hertz) or a national used car
rental company offering discount prices, such as Rent-A-Wreck.
3. Bonnie CLAC will develop and test a car purchase program with
car manufacturer Honda or Toyota. Bonnie CLAC will finance
the new cars in monthly installments, to be paid by the clients’
monthly BRIDGE payment fees.
At the conclusion of the test in Year 1, Bonnie CLAC will select the
most cost effective and scalable BRIDGE option to implement across all
of its district offices. The option selected should not have a significant
detrimental effect on Bonnie CLAC’s finances.
In addition, emphasis will be placed on human resources, including
the creation of hiring, training, development, and evaluation policies
and procedures at the national and district levels. Information about
these areas can be found throughout the rest of the business plan.
3. Refine the Marketing Strategy
Bonnie CLAC will craft a clear brand and communications strategy
and develop a target consumer profile to identify Bonnie CLAC’s most
promising clients. In Phase I, Bonnie CLAC will test three strategies to
more effectively reach these target clients, consisting of referrals, district
partnerships, and direct marketing. More details can be found in the
Marketing section (Section VI) of the business plan.
4. Build an Alumni Network
Bonnie CLAC follows up with its clients after the car purchase transaction and supports its clients through the five-year life of the loan.
The Chief Marketing Officer will work with Regional Directors to build
an alumni network and maintain a regular schedule of alumni contact,
including alumni outreach newsletters, organized alumni events, and
other alumni activities.
5. Strengthen Technology Systems
In Phase I, Bonnie CLAC will strengthen its technology systems so
they are better able to support all aspects of the organization as it grows.
Bonnie CLAC will engage a third-party to review its long-term informa-
tion technology needs. This review will be designed to identify current
deficiencies in Bonnie CLAC’s technology systems and make the necessary improvements for scaling.
As part of its technology review, Bonnie CLAC will assess the functionality of Bonnie CLAC Cars™ (its current QuickBase database
system) as a scalable application capable of handling both district and
national operations. It will identify performance gaps in the system, develop a plan to address these gaps, and acquire the necessary technology
to meet the organization’s future needs.
More details about technology can be found in Section V of the business plan.
C. Build a Robust Measurement and Quality System
Phase I Goal: Develop the necessary dashboard(s) and processes to
establish a coordinated program of organizational-health, program-performance, and social and economic impact measurement.
Action areas in this phase will focus on three core activities:
1. Measurement and Quality System
In Phase I, Bonnie CLAC will develop a self-evaluation system that
measures ongoing performance of both district and national operations
as well as the long-term impact it has on the lives of its clients and the
environment. The implementation of this system will include a feedback
loop that allows Bonnie CLAC to evaluate its performance at regular intervals and make necessary adjustments to improve performance.
2. Third-Party Evaluations
Bonnie CLAC is currently undergoing its first third-party evaluation.
Conducted by the Carsey Institute at the University of New Hampshire,
this outside evaluation will culminate in a published report in Winter
2007. (The preliminary interview guide, preliminary interview results,
and the final survey instrument are located in Bonnie CLAC Appendices 8, 9 and 10). In Phase I, Bonnie CLAC will build upon the initial
third-party evaluation. Bonnie CLAC will hire a long-term third-party
evaluator to track the longitudinal impact of its work. These efforts will
validate the credibility of Bonnie CLAC’s program and enable the organization to attract government and other support in future years.
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3. Research Agenda
In Phase I, Bonnie CLAC will explore the possibility of working with
academic institutions and/or professors to develop a research agenda.
The agenda would identify research questions to be answered, such as
the long-term effects of reliable transportation or the availability of car
financing for very low to moderate income individuals. Bonnie CLAC
would offer its academic partners access to its proprietary dataset so
researchers could produce white papers that answer these questions and
contribute to policy awareness of very low to moderate income needs.
D. Establish Initial State & National Partnerships
Phase I Goal: Develop state and national partnerships that prepare
Bonnie CLAC to scale.
Bonnie CLAC will develop mutually beneficial state and national
partnerships with the following categories of organizations in order to
increase efficiencies of the operating model and to develop additional
funding sources in preparation to scale.
Car manufacturers
Financial institutions
Media outlets
Nonprofit organizations
Government agencies
Partnership strategy will be discussed in greater detail in Sections VI
and VII of the business plan.
E. Support Public Policy
Phase I Goal: Develop focused initiatives to support state and federal public policies that further the organization’s mission and vision.
Bonnie CLAC plans to focus on the following public policy areas:
Transportation Individual Development Accounts (TIDAs)
The ability for TANF (Temporary Assistance for Needy Families)
recipients to own cars worth more than $4,000
A federal one-time earned income tax credit (EITC) to be used
for the purchase of a reliable, affordable car through a nonprofit
organization
In addition, Bonnie CLAC will form alliances with state and federal government agencies, national foundations, and other nonprofit
organizations to focus on additional initiatives that will impact the organization’s mission and vision. These agency and foundation alliances
are discussed in greater detail in the public policy section (Section X) of
the business plan.
Phase II: Testing Growth of Districts Nationwide, 2 Years
(January 2010–December 2011)
In Phase II, 2010 through 2011, Bonnie CLAC will launch an additional 21 districts throughout the remaining New England states and
other states nationwide. Table H shows the total number of very low to
moderate income households in each state. This table confirms the vast
market opportunity of approximately 42.5 million very low to moderate
income households (or 40.0 million households excluding New England) that form the target market for Bonnie CLAC’s services.
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Table H: Number of Very Low to Moderate Income Households by US State
BUSINESS PLAN IMPLEMENTATION: ORGANIZATIONAL
CAPACITY BUILDING
IV. TEAM & GOVERNANCE
Phase I Goal: Establish national and district office organizational
structures and build a national leadership team.
A. Bonnie CLAC National Organizational Structure
In order to prepare Bonnie CLAC for national growth, a Chief Executive Officer will be hired in January 2008. Robert Chambers, the
President, will continue to focus on marketing, fundraising, business development, and public speaking while the CEO will focus on building
stable and efficient operations. As the organizational structure of the
national office for Phase I, shown below in Figure G, illustrates, Responsibility and resources are heavily concentrated in the national office (see
Figure G) while district offices operate on a basic structure. This structure allows Bonnie CLAC to offer centralized support to districts and
streamline operations in preparation for growth. Below are an organizational chart and a table showing each national officer’s responsibilities.
Figure G: Bonnie CLAC National Organization Chart
NATIONAL ROLES AND RESPONSIBILITIES (PHASE I)
Executive Board
Approves and monitors business plan
Performance review of President and
CEO
Monitors finances
Supports President and CEO in other
areas on an as-requested basis
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Co-Founder and
President—Robert Chambers
national leadership team
Co-leads the implementation of the
business plan, reporting to the Board of
Directors (The President and the CEO
work closely together and sit in the
Office of the President.)
Leads the development of all national
partnerships
Leads all fundraising activities
Primary spokesperson for Bonnie
CLAC to the public, attending industry, public policy, corporate, nonprofit
and fundraising meetings
Supports the development of marketing
Supports the development of districts
Chief Executive Officer
(hired Jan. 2008)
Co-leads the implementation of the
business plan, reporting to the Board
of Directors (The President and the
CEO work very closely together and
sit in the Office of the President.)
Leads the development of all systems
for national and district
Leads the development of all performance measurement systems
Monitors, reviews, and acts on organizational and program performance
indicators at appropriate intervals
to ensure that national office and
districts are operating efficiently and
effectively
Oversees all national leadership team
members except President
Oversees district operations and manages the Regional Directors
Ensures a smooth communications
and coordinating relationship between national and district offices
Executive Coordinator
(hired Jan. 2008)
Assists President, CEO, other Senior
Management in carrying out daily
functions
Oversees additional hiring and training of administrative staff as necessary
Executive Assistant
(2 Assistants hired
Jan. 2009)
Assists Senior Management in carrying out daily functions
Reports to the Executive Coordinator
Chief Marketing Officer
(hired June 2008)
Leads the development of all
marketing activities, with particular
emphasis on developing scaling strategies to reach target Bonnie CLAC
clients in all districts
Works with CEO and Regional Directors to support district marketing
efforts
Works with President to develop
and implement national marketing
programs
Director of Training and
Human Resources
(hired Jan. 2008)
Leads the development and implementation of all training for starting
and growing districts
Develops, implements, and administers benefit programs for Bonnie
CLAC staff
Develops, implements, and administers training and staff development
programs
Reviews relevant dashboard indicators with CEO monthly
Director of Measurement
& Quality
(hired Jun. 2008)
Develops, tracks, analyzes, and
publishes organizational-health and
program-performance indicators
monthly to maintain quality
Collects survey/interview data at appointed intervals to track social and
economic indicators
Publishes social and economic indicators on semi-annual basis
Leads the annual process to review
indicators and the Social Impact
Model to ensure the organization is
achieving its mission and vision
Prepares, publishes, and disseminates
an annual report card of outcomes
Serves as liaison for all third-party
evaluations
Leads the development of a research
agenda, which includes fostering relationships with academics and public
policy research efforts
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Technology/Web Manager
(hired Apr. 2008)
Updates organization’s website, as
necessary
Updates proprietary data management system, Bonnie CLAC Cars™,
as necessary in order to continually
streamline and improve operational
and measurement efficiency as the
organization grows
Updates QuickBooks as necessary in
order to incorporate additional functions for financial recordkeeping
Serves as resource to Senior Management to help them carry out various
programs
Keeps abreast of new technology
programs and develops recommended
courses of action for purchase and
implementation
Locates and evaluates third-party
technology firms/consultants to
perform and implement technology
reviews as necessary
Develops standards for computing hardware and software for the
organization
Serves as the point person on all
technology issues for the organization
Development Director
(hired Jan. 2008)
Writes grant proposals
Supports cultivation and management of philanthropic relationships
Leads annual fundraising campaign
Supports all local fundraising efforts
Develops all marketing materials in
conjunction with the Chief Marketing Officer, including collateral, pitch
letters, etc.
National Intake Manager
(hired Jun. 2008)
Conducts all intake interviews to
determine eligibility of Bonnie CLAC
prospects
Assigns accepted prospects to oneon-one interviews with local Client
Consultants
National BRIDGE Manager
(hired Jun. 2008)
Leads effort to scale the BRIDGE
program, by developing relationships with car rental companies and
car manufacturers to develop a test
program, analyzing test results, and
making a recommendation for implementation
Manages BRIDGE program, including
responsibility for its bottom line
Coordinates with district offices on
BRIDGE car placements, payments,
and all other necessary functions
Processes payments, keeps accurate
enrollment records, and tracks metrics, including utilization, capacity,
and average client tenure, alerting
other national staff members if there
is a problem
National Delivery Manager
(hired Jun. 2008)
Completes necessary paperwork for
all new car titles
Coordinates with district offices to
ensure a smooth and efficient delivery
process
Develops extensive knowledge of
local auto dealerships
NATIONAL ROLES AND RESPONSIBILITIES (PHASE II)
Chief Financial Officer /
Controller
(outsourced part time in
Phase I—hired full time in
Jan. 2010)
Prepares accounting and other financial statements for both the national
office and district office roll-up
Manages relationships with national
lending organizations used by Bonnie
CLAC
Helps ensure national office solvency
and overall financial health through
sound financial record-keeping, analysis, and decision-making
Monitors cash flow and establishes
processes to approves expense
Reviews relevant dashboard indicators
with CEO monthly
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B. Bonnie CLAC District Organizational Structure
In Phase I, a Regional Director will be hired to oversee the New
Hampshire flagship district and launch one additional district in 2008.
When a new district is launched, it will be staffed by a Lead Client
Consultant, who will grow into the role of District Director under the
guidance of the Regional Director. At inception, the Client Consultant’s
role will consist of 50% marketing and 50% direct client work. As the
number of clients in the program increases each year and additional Client Consultants are hired, the Lead Client Consultant’s role will shift to
80% marketing and 20% direct client work. The Lead Client Consultant will work closely with the National Intake Manager, the National
Delivery Manager, and the National BRIDGE Manager to coordinate
the intake, delivery, and BRIDGE functions, respectively.
In Phase II, Bonnie CLAC will hire additional Regional Directors to
oversee expansion locations. The Regional Directors will work closely
with the Director of Training and HR to develop Lead Client Consultants; with the Chief Executive Officer to determine when and where
to open new district and satellite offices and to review monthly district
dashboard targets; with the Chief Marketing Officer to develop and
implement marketing strategies to ensure sufficient client outreach to
achieve set targets; and with the Development Director to coordinate
local fundraising. Below are a district organizational chart and each staff
member’s responsibilities within a district.
Figure H: Bonnie CLAC Phase I District Organization Chart
DISTRICT GROWTH ROLES AND RESPONSIBILITIES
Regional Director
(to be hired Jan. 2008)
Oversees regional operations and launches
and grows new district offices
Works with the Director of Training and
HR to develop lead client consultants into
District Directors
Reviews district dashboards monthly with
the Chief Executive Officer, the District’s
District Directors, and possibly the
District’s Client Consultants
Working with the CMO, distributes marketing collateral, press releases, and other
promotional materials designed to help fill
the regional pipeline
Establishes necessary regional partnerships
Works with Development Director on local
fundraising efforts
Lead Client Consultant (hired at start of
each new district)
Responsible for the success of the district,
from its day-to-day operations to its strategic objectives and financial health
Hires, manages, and develops district staff
Reviews district dashboards monthly with
the Regional Director
Working with the Regional Director, distributes marketing collateral, press releases,
and other promotional materials designed
to help fill the pipeline
Establishes necessary district partnerships
Each district office will launch with a lead
client consultant, who may grow into the
role of District Director.
At inception, the role will consist of 50%
marketing and 50% client consulting work,
to become 80/20 when additional client
consultants are hired.
Participates in local fundraising efforts
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DISTRICT GROWTH ROLES AND RESPONSIBILITIES
Client Consultant
Works with District Director to ensure solid
target marketing in satellite territory
Receives client assignments from the
National Intake Manager and meets
one-on-one with all approved, assigned
prospects to enroll them in the program
Coordinates with National BRIDGE Manager to place clients in BRIDGE cars
Regularly monitors the progress of each
assigned client
Counsels clients one-on-one to help them
attain car ownership
Monitors loans and performs workouts, as
necessary
Coordinates with National Delivery Manager for car delivery and accompanies the
client to the car dealership for car pickup
Follows up with client to provide support
throughout the duration of the loan
Contacts past clients periodically to promote client referrals
Maintains a regular schedule of contact
with alumni by sending alumni outreach
newsletters, organizing alumni events, and
planning other alumni activities
Reviews relevant indicators with Regional
Director and/or District Director on a
monthly basis
C. Governance
Since its inception in 2001, Bonnie CLAC has benefited from a strong
governing board. The Board of Directors still includes both co-founders,
who continue to take an active interest in the organization’s operations.
The role of the Board of Directors is to supervise and advise the management of Bonnie CLAC, doing everything in its power to ensure that the
organization carries out its mission in the most efficient and productive
manner possible toward the accomplishment of its vision. The Board of
Directors meets monthly. In recent years, the Board has diversified its
areas of expertise by adding new directors from the fields of financial
management and marketing. A Bonnie CLAC alumnus has also joined
the Board in the role of client representative in order to provide a client
voice and perspective.
The most recent addition to the board is Allan Ferguson, a former
venture capitalist. His experience in growing companies will provide insight and experience in overseeing Bonnie CLAC as it scales.
The Board of Directors currently consists of the following (See Bonnie CLAC Appendix 11 on page 167 for short bios):
1. Robert L. Chambers, Hanover, NH. President & Co-Founder of
Bonnie CLAC.
2. Mary Burnett, Hinsdale, NH. Executive Director of Bonnie
CLAC.
3. Robert E. Field, Sr., Hanover, NH.
4. Leo A. Hamill, Jr. Hanover, NH. Co-Founder of Bonnie CLAC.
5. Robert Hansen, Hanover, NH.
6. David Reeves, Norwich, VT.
7. Judith Richard, Concord, NH.
8. Chandra L. Ribiero, West Lebanon, NH. Bonnie CLAC Client
Representative.
9. Rick Sayles, Hanover, NH.
10. Allan Ferguson, Meriden, NH.
Bonnie CLAC is committed to further strengthening its governing
board by carrying out the following six actions in Phase I:
1. Develop a consistent process to monitor the execution of the
business plan in close coordination with the President and CEO.
If the President and the CEO disagree on a specific area of
execution of the plan, the issue will be brought to the Board for a
final decision.
2. Develop a consistent process to evaluate the President and the
CEO of Bonnie CLAC on an annual basis.
3. Add 1-2 new board members in areas such as national fundraising and public policy.
4. Launch a CEO search task force, to be led by Co-founder and
Board Director Leo Hamill. (See Bonnie CLAC Appendix 12 on
page 169 for the CEO job description).
5. Develop an expanded Bonnie CLAC Advisory Board to represent and promote Bonnie CLAC. Such an expansion could
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include adding high-profile members from politics, foundations/
nonprofits, and corporations, who will publicly support Bonnie
CLAC and help build relationships in their respective field.
6. Form a formal Audit Committee to review financial matters for
Bonnie CLAC on a regular basis.
V. TECHNOLOGY
Phase I Goal: Build upon the organization’s current technological
infrastructure to be able to scale for growth.
A. Current State
Bonnie CLAC has already established a firm technology foundation
upon which to build future growth. Recognizing early on that information technology would become increasingly important for its expansion
plans, the organization has worked diligently to build a simple, yet robust, technology infrastructure.
Nearly all recordkeeping at Bonnie CLAC is done electronically.
Bonnie CLAC uses a database application to support its operations and
a well-known software application for its bookkeeping and financial
management.
1. Bonnie CLAC Cars™
Bonnie CLAC uses a proprietary data management system known as
Bonnie CLAC Cars™ which was built with Intuit’s QuickBase, a webbased environment used by over 45 of the Fortune 100 companies.76
QuickBase provides a set of online workgroup applications designed for
common business needs that have been customized to support Bonnie
CLAC’s unique data management requirements.
Bonnie CLAC Cars™ performs the following functions:
Inbound client call management
Initial telephone profile intake and client registration
Financial fitness course registration
Counseling session logging
76 http://www.quickbase.com/p/features/overview.asp
Appointment and class scheduling
BRIDGE car recordkeeping
Donation acceptance
Correspondence creation and tracking
Car dealer relations
Loan processing, including preparation and storage of loan documentation
Title transfers
Summarizing and reviewing operational activities
Bonnie CLAC Cars™ is run on high-reliability host computers operated by Intuit. Thus, Bonnie CLAC does not need to install software or
maintain data on its local computers or servers for this application. All
staff members have access to a desktop computer in a Bonnie CLAC
office, or, if they work remotely, a laptop (typically an older model IBM
ThinkPad). Using these computers, Client Consultants and other staff
members can access Bonnie CLAC Cars™ at anytime using a highspeed Internet connection; and with laptops, anywhere.
Since Bonnie CLAC Cars™ is a hosted QuickBase application, its data
is automatically backed up by Intuit. In addition, Bonnie CLAC Cars™
can be modified relatively easily. Bonnie CLAC has been able to meet its
changing needs by adding new data types and content as necessary.
With a flexible technology infrastructure, the organization has an extendable platform to support additional districts and geographic areas as
it grows. However, in order to implement Phases I and II, modifications
to Bonnie CLAC Cars™ will be required. Section B below outlines these
expected modifications.
2. QuickBooks
For its accounting and bookkeeping processes, Bonnie CLAC relies
on another Intuit product, QuickBooks Nonprofit 2005 Premiere Edition. With over three million small business software customers and
230,000 accountants, QuickBooks is the #1 rated and recommended
small enterprise financial management software.77
77 http://quickbooks.intuit.com/product/about-quickbooks/small-business-financialsoftware.jhtml
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QuickBooks simplifies receiving funds, tracking expenses, making
payments, and managing payroll. Data on clients, donors, vendors, and
employees can be seen and tracked by Bonnie CLAC at a glance. At
present, Bonnie CLAC makes limited use of QuickBooks’ passwordaccess and permissions features. As needed, Bonnie CLAC will make
more extensive use of these features to limit users to specific data types
and activities. Use of QuickBook’s expanded permissions features and
audit trail features will take Bonnie CLAC through Phases I and II of
the business plan implementation.
B. Phase I Plan for Technology
Bonnie CLAC will engage a third party to review its long-term information technology needs. This review will be designed to answer several
questions, including:
How can any current deficiencies in Bonnie CLAC Cars™ be addressed most effectively and expeditiously?
What new and/or revised functionality will be needed to support
multi-district, multi-state, and national operations?
Will QuickBase remain a cost-effective platform as operations grow?
Will an intranet be needed to support internal operations and
collaboration?
Will additional hardware and/or software be required to support
the business plan?
Will additional staff, such as a Webmaster and/or a QuickBooks
Administrator, be required to support Bonnie CLAC as it grows?
Will QuickBooks Premier remain adequate or will Bonnie CLAC
need to upgrade to QuickBooks Enterprise or Online Editions—
or to another bookkeeping and accounting application?
Following this review, one or two technology partners will be selected to address Bonnie CLAC’s short-term and long-term technological
needs. In the short term, Bonnie CLAC will address deficiencies that
might prevent the successful implementation of Phase I of the business
plan. For the longer term, Bonnie CLAC will address any other technology issues identified by the third-party review so it will be poised for
national rollout.
As part of its technology review, Bonnie CLAC will assess the functionality of Bonnie CLAC Cars™ as a scalable, national database system
capable of handling both district and national operations; identify
performance gaps in the system; and develop the additional features
necessary to address these gaps. Such additional features may include
the following (also listed in Bonnie CLAC Appendix 13 on page 173):
Lifecycle tracking of data on prospects, clients, and alumni at
each stage of the process
Ability to summarize and report such data by day, week, month,
and year
Tracking, summarizing, and reporting on data by Client Consultant, office, district, (possibly) state, and national, with consistent
comparative reporting across all entities
Capture of standard data from prospects/clients, including referral
source, reason for loss of prospect (if applicable), previous car,
income and available income, and family size and type
Use of drop-down selections wherever possible to ensure consistent data across the enterprise
Transaction-based records, such that each transaction with a client is held as a separate record
Alerts to remind Client Consultants to follow up with alumni
after a set period or at other key times
Ability to change sales stages over time
Tracking of funding, donations, and in-kind contributions at the
local, district, and national levels
Reporting key-indicator data on dashboards for easy management
access and action
VI. MARKETING
Phase I Goal: Establish the necessary marketing tools, programs,
and partnerships for district and national expansion.
To carry out its district and national expansion, Bonnie CLAC plans
to launch a dynamic marketing initiative consisting of three parts:
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1. Develop a clear Brand & Communications strategy
2. Develop a target profile for successful Bonnie CLAC clients
3. Test three strategies to more effectively reach target clients
A. Brand & Communications
1. Brand
Bonnie CLAC will hire a Branding & Communications firm to develop a brand identity that clearly designates it as the organization
that enables very low to moderate income individuals to purchase an
affordable new car, which results in improvements in their lives and is
consistent with maintaining a sustainable environment.
Upon completion of brand identity research, Bonnie CLAC and/or
the Branding & Communications firm will formalize guidelines for logos
and colors, create marketing templates for all communications efforts,
and develop a consistent look, feel, and message across all marketing
channels.
2. Communications
Bonnie CLAC will develop targeted messaging and produce the
necessary communications materials to reach three core constituent
groups—prospects, referrals, and local partners.
a. Bonnie CLAC will conduct historical research and survey best practices from both for-profit and nonprofit organizations in its industry
to identify the key words, concepts, ideas, and images that resonate
with prospects, referrals, and local partners.
b. Bonnie CLAC will conduct focus groups with each constituency to
identify the most effective messages and communications materials
for each group.
c. Bonnie CLAC will produce the necessary communications materials
to broadcast its messages to its desired audiences.
The majority of Brand & Communications work will be done at the
beginning of Phase I, with reviews and updates performed each subsequent year. The work will be led by the national office, in consultation
with partners, constituents, Client Consultants, and other relevant parties, and disseminated through the district offices.
B. Target Client Profile
In order to scale its operating model, Bonnie CLAC will identify the
most cost-effective and efficient ways to reach target clients in Phase I.
The historical profile of a successful Bonnie CLAC customer is described
below in Table I. This profile will be refined over time as additional data
is collected.
Table I: Historical Profile of a Successful Bonnie CLAC Client
Earns an average monthly income of ~$1900-$2200
Has at least $300 in disposable income after monthly expenses
are paid
Has steady employment
Is looking/willing to buy a new car
Is/can learn to be fiscally responsible
Does not have/is willing to work toward not having an account in
collection
C. Target Marketing
Bonnie CLAC will test three strategies to more effectively reach
its target clients: 1) referrals, 2) direct marketing, and 3) district partnerships. Bonnie CLAC will spend approximately $200 on marketing
expenses for each successful car transaction in Year 1. The marketing
budget will decrease to $175 per successful car transaction in Year 3 and
$150 per successful car transaction in Year 5 (see Bonnie CLAC Appendix 14 for the Marketing Road Map).
1. Referrals
In Phase I, Bonnie CLAC will develop a systemic process to increase
client referrals from a) Bonnie CLAC alumni, b) Bonnie CLAC employees, c) local small business and other district area organizations, and d)
social service agencies.
a. Bonnie CLAC Alumni
Bonnie CLAC alumni (clients who have received their cars
through successful completion of the Bonnie CLAC program) occasionally refer their friends and receive a one-time referral fee of
$10 for each friend who enrolls in Bonnie CLAC and $25 for each
friend who completes Bonnie CLAC. In Phase I, Bonnie CLAC
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will formalize both the process and the incentive system for alumni
referrals (see Bonnie CLAC Appendix 15: Bonnie CLAC Alumni
Membership Program on page 173).
b. Bonnie CLAC Employees
Bonnie CLAC employees and Board members have also made
successful client referrals in the past. In Phase I, Bonnie CLAC
will formalize both the process and the incentive system for employee referrals.
c. Local Small Business and Other District Area Organizations
Lead Client Consultants will identify local small businesses and
other district organizations where employees can drop off promotional flyers tagged with location-specific codes (see Bonnie
CLAC Appendix 16). These location-specific codes will be used
to determine the district sites that provided the most and the best
clients.
d. Social Service Agencies
Bonnie CLAC will continue to develop strong ties with local
social service agencies in each district that work with its target client base. Lead Client Consultants will provide promotional flyers,
deliver presentations, and maintain continuity of contact.
2. Direct Marketing
In addition to increasing referrals, Bonnie CLAC will pilot three direct marketing channels: a) direct mail, b) newspaper advertisements,
and c) direct-mail coupon programs such as VAL-PAK. As it enters a
new district or satellite location, direct marketing may be the most costefficient way for Bonnie CLAC to reach large numbers of target clients.
In each new district or satellite location, Bonnie CLAC will purchase
contact information for local households that earn average monthly incomes of $1900 or above. Prospects who pass the initial income screen
will be contacted by Bonnie CLAC via direct mail, newspaper advertisements, or direct-mail coupon programs such as VAL-PAK.
3. District Partnerships
Partnerships will play a critical role in Bonnie CLAC’s growth and
development. As Bonnie CLAC expands, it will continue to develop
mutually beneficial partnerships with social service agencies, corporations, health organizations, and nonprofit organizations to recruit its
target clients. Particular attention will be paid to regional and national
entities that offer broad scaling opportunities.
a. Financial Fitness Organizations
In Phase I, Bonnie CLAC will pilot partnerships with social
service agencies that teach high-quality financial fitness classes.
Bonnie CLAC is currently testing a partnership with the Vermont
chapter of JobCorps.
JobCorps Region One (http://bostonregion.jobcorps.gov) is a
no-cost education and vocational training program administered
by the US Department of Labor for young people ages 16 through
24 in Connecticut, Maine, Massachusetts, New Hampshire, New
Jersey, New York, Rhode Island, Vermont, Puerto Rico, and the US
Virgin Islands. One component of the JobCorps training program
is a high-quality financial literacy class, which includes financial
education, savings, and asset building.78
Bonnie CLAC has agreed to finance cars for select financial literacy graduates age 20 and above. If the partnership with the Vermont
chapter proves successful, Bonnie CLAC will expand its partnership
with JobCorps throughout New England and nationwide.
b. Corporations
Bonnie CLAC has initiated successful marketing campaigns
with corporations in the New Hampshire district who employ
a large number of workers fitting Bonnie CLAC’s target demographic. These corporations publicize Bonnie CLAC’s services
internally to their employees; in return, Bonnie CLAC helps those
employees who enroll in the program obtain more reliable transportation to get to and from work. In Phase I, Bonnie CLAC will
develop a more formal corporate partnership package to standardize the way it solicits and partners with local corporations. (See
Bonnie CLAC Appendix 17 on page 174.)
78 http://treasurer.delaware.gov/documents/2005/09-26-05-Financial_Literacy.shtml
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c. Health Organizations
Bonnie CLAC will seek out organizations in the health industry as partners to help market its services. Health organizations
know how much their clients and employees depend upon reliable transportation to obtain or provide health services. Many of
their clients and employees also fit Bonnie CLAC’s target demographic.
Dartmouth-Hitchcock Medical Center, located in Lebanon,
NH, employs many successful Bonnie CLAC clients. Bonnie
CLAC is currently developing marketing partnerships with other
health-care organizations, such as The Edgewood Centre, a nursing and long-term care facility located in Portsmouth, NH.
d. Nonprofit Organizations & Universities
Bonnie CLAC will partner with nonprofit organizations and
universities to recruit experienced and retired executives and
college and business school students, respectively, as pro-bono
marketing fellows who will work with Bonnie CLAC marketing
personnel in creating marketing materials and implementing the
organization’s marketing strategy.
In the past, Bonnie CLAC has developed internships with
United Way and Tuck Business School. United Way has a formal
loaned executive volunteer program in which the United Way
recruits local business executives and places them in community
organizations in volunteer, marketing, training, account, and administrative management roles for a fixed period of time.79
In Phase I, Bonnie CLAC will partner with additional United
Way chapters, business schools, and universities and develop a
relationship with SCORE, an organization with 10,500 volunteer
executives and business owners (both working and retired), who
donate time and expertise as business counselors.80 SCORE has
389 chapters throughout the United States and its territories.
Using these partnerships, Bonnie CLAC will also develop a systematic volunteer recruitment and utilization process.
79 http://www.unitedwaycapitalarea.org/giving/le.cfm
80 http://www.score.org/explore_score.html
VII. STATE AND NATIONAL PARTNERSHIPS
Phase I Goal: Develop state and national partnerships that prepare
Bonnie CLAC to scale.
In addition to the development of district partnerships, Bonnie
CLAC will also develop mutually beneficial state and national partnerships with car manufacturers, financial institutions, and media outlets.
In Phase I:
a. Bonnie CLAC will develop relationships with car manufacturers
Honda and Toyota to obtain purchase discounts for its very low to
moderate income clients.
b. To obtain loans for its clients nationwide, Bonnie CLAC will
develop relationships with national financial institutions. Bonnie
CLAC has identified the following banks as targets: Citizens Bank,
Bank of America, Chase Manhattan Bank, and Citibank.
Bonnie CLAC’s financial partners must:
Be authorized to provide loans across the United States
Offer wholesale interest rates to very low and moderate income
clients if Bonnie CLAC serves as the guarantor
Be willing to work with any Bonnie CLAC-approved client
Be committed to the social vision of Bonnie CLAC. How active a
financial institution has been in carrying out activities mandated by
the federal Community Reinvestment Act (CRA) may serve as an
indication of its commitment to Bonnie CLAC’s social vision.
c. To increase press coverage of the organization’s activities, Bonnie
CLAC will develop strong partnerships with both local and national
news media organizations.
(See Bonnie CLAC Appendix 18 on page 175 for a list of Bonnie
CLAC’s target district, state, and national partnerships.)
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VIII. FINANCIAL SUSTAINABILITY
Phase I Goal: Bonnie CLAC will implement a financial sustainability strategy that builds profitable districts that will contribute financially
to the national operational budget. As Bonnie CLAC strengthens its
national operations, it will rely on a mix of earned and philanthropic
revenues to support its growth.
Capitalization Required
Bonnie CLAC has already raised $1.2 million towards its growth
strategy. Bonnie CLAC is now seeking an additional $2.7 million in
Phase I and an additional $9.6 million in Phase II for a total capitalization of approximately $12.3 million over the next five years (see Table
J). Approximately $4.3 million of the $12.3 million Bonnie CLAC is
raising will go toward launching 25 new district offices.
As Table J below shows, Bonnie CLAC has also raised nearly $1.0
million in likely funds for Phase I. (See Appendix 19 on page 178 for
a list of all of the philanthropic organizations that have made financial commitments to Bonnie CLAC for Phase I. ) The Bonnie CLAC
national office will also receive earned revenue contributions from the
New Hampshire flagship district office in 2008 and from each new district office beginning in its third year of operations. In Phase I, Bonnie
CLAC will also explore additional revenue stream opportunities with
government agencies, corporate partners, and car manufacturers.
Table J: National Office Budget and Capitalization Required
Phase I: 20082009
Total Expenses
$5,290,855
Total Earned Revenues
$1,521,731
Phase II: 2010-2012
$20,429,965
$10,743,530
Total Committed Funds $1,060,500
Raised to Date
$125,000
Total Capitalization
Required
$2,708,624
$9,561,435
Total Likely Funds
Raised to Date
$932,000
$0
Balance Remaining
$1,776,624
$9,561,435
Rest of Section Removed for Publication
Table K: New District Financial
Table L: Number of District Clients & Alumni
Table M: Required Pipeline Conversion Rates
Table N: Bonnie CLAC Program Fees
Table O: Number of New Hampshire Flagship District Clients & Alumni
Table P: New Hampshire District Financial Snapshot
Table Q: National Financial Snapshot
Figure I: Possible Bonnie CLAC 20-Year Financial Sustainability Trajectory
(2007-2027)
IX. MEASUREMENT & QUALITY SYSTEM
Phase I Goal: Bonnie CLAC will develop the necessary dashboard(s)
and processes to protect quality and establish a coordinated program to
consistently measure organizational-health, program-performance, and
social impact measurement in the areas of economic, health/lifestyle,
and the environment.
Preliminary Results from Third-Party Evaluation of
Social Outcomes
During the business planning process, The Carsey Institute at the
University of New Hampshire conducted the first third-party evaluation of Bonnie CLAC’s program outcomes. Final results on the social
and economic impact of program participation in Bonnie CLAC will
be published in a report in December 2007, with preliminary results
described below.
The specific research questions posed by the study were:
To what extent do participants’ credit scores improve?
To what extent do employment patterns and earnings change?
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To what extent does family/community involvement change?
To what extent does overall well-being and health change?
The research consisted of in-depth interviews with 13 Bonnie CLAC
alumni as well as questionnaire surveys sent to Bonnie CLAC alumni. A
brief analysis of the interview data is included in the appendix. (See Bonnie CLAC Appendix 8 on page 155 for the interview guide and Bonnie
CLAC Appendix 9 on page 158 for interview results.) The interviews
provided insight into the impact of program participation, from overall
improvement in “peace of mind” due to having a reliable automobile to
improvements in job performance and budgeting. The interviews also
provided data useful for the development of the survey instrument and
the analysis of the survey data.
The survey (see Bonnie CLAC Appendix 10 on page 162) was sent
to over 200 Bonnie CLAC alumni. Responses are still being received.
The preliminary data on 48 responses received and coded to date show
the following:
Although relatively few respondents have actually changed their jobs
or earnings (10% and 17% respectively), getting to their jobs and doing
so punctually have improved (48% and 38%).
Spending patterns have changed for many; respondents to date report spending less on gas (39%), insurance (27%), repairs (75%), and
interest rates (42%). Many are also more careful about budgeting and
paying their bills on time. These will do doubt lead to improved credit
scores in the long run. The data on credit scores are still being obtained
from lending institutions and will be analyzed when received.
Family and community involvement also appear to be affected by
Bonnie CLAC participation: the majority of respondents report being
better able to provide transportation for family members (56%), and
many report improved ability to attend children’s activities (33%). Almost half attend more community events, and three-quarters are in a
better position to shop and run errands.
Finally, with respect to overall health and well-being, there are substantial improvements. Over half are better able to make health and
dental appointments, and over a third have greater options for purchasing food and for health care. The majority of respondents report that
their overall financial situation has improved (69%), and almost half are
better able to pay their bills.
Although not one of the research questions, we also asked about satisfaction with the program; and not surprisingly, the vast majority of
respondents to date report that their overall experience with Bonnie
CLAC has been excellent (81%). Eighty-eight percent would recommend the program to others.
Indications are that the program is having the desired impact on clients with respect to community involvement and overall well-being. In
addition, there is some evidence of job impacts, and spending patterns
have changed dramatically. Given these findings from the survey, it is
likely credit scores will show a positive change as well.
Implementing a Measurement and Quality System
Bonnie CLAC will measure the impact of its work by implementing
three tasks:
A. Implement indicators
B. Implement measurement tools and tracking system
C. Implement feedback and self-evaluation
A. Implement Indicators
Bonnie CLAC will assess the status of its organization on an ongoing
basis by implementing the following two types of indicators:
1) organizational-health and program-performance indicators and
2) social impact indicators.
Organizational-health and program-performance indicators provide critical insight into the stability of an organization, its capacity to
carry out its work, and its relative success in accomplishing its business
objectives. These indicators measure an organization’s financial and
operational health and performance. Each of Bonnie CLAC’s organizational-health and program-performance indicators will be tied to one of
the goals set forth in the various sections of this business plan.
For Bonnie CLAC, they will cover areas including consultant performance, marketing flow, financial performance, and partnership
development. Such indicators will be reported at the district and national levels, as relevant.
They will also include measures of the organization’s effectiveness
in meeting its goals, such as building its national leadership team, its
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technological infrastructure, and its marketing programs. With few
exceptions, such indicators will be relevant and reported only at the
national level.
Bonnie CLAC’s organizational health and program performance indicators appear below in Table R.
Table R: Bonnie CLAC Organizational-Health and Program-Performance
Indicators
GOAL
INDICATOR
Goal 1: Establish profitable district offices in states nationwide
DISTRICT
Consultant performance, % of capacity, by district
Consultant performance, % of cars delivered, by district
Prospect inquiries, % of target, by district
Prospects screened, % of target, by district
Clients enrolled, % of target, by district
Cars delivered, % of target, by district
Earned revenue, % of target, by district
Philanthropic revenue, % of target, by district
Expenses, % of target, by district
Revenue/car, % of target, by district
Expense/car, % of target, by district
Average time from intake to car, by district
Percent of clients in FastTrack, by district
Percent of clients in BRIDGE, by district
Percent of clients in FinFit, by district
Number of Client Consultants, by district
Number of cars available for BRIDGE, by district
Number of clients on BRIDGE wait list, by district
Bridge program bottom line
Default rate, by district
Districts by % of profitability
NATIONAL
Districts Opened
Total Number of Districts
Number of Clients Receiving Cars
Amount of Financing Secured
Social impact indicators document an organization’s progress in addressing its target social problem. For Bonnie CLAC, they will track the
organization’s effectiveness in improving the economic and health/lifestyle outcomes of its clients, and its impact on the environment.
In order to best develop a comprehensive list of social and economic
indicators, Bonnie CLAC will continue working with experts to ensure
they select the most commonly accepted indicators in improving the
economic and health/lifestyle outcomes of its clients, and its impact
on the environment. Below in Table S are the current list of Bonnie
CLAC’s social and economic impact indicators.
Table S: Bonnie CLAC Social and Economic Impact Indicators
Client credit scores on entry, graduation, and 6/12/18 months later (Goal SII 1)
Monthly wages on entry, graduation, and 6/12/18 months later (Goal SII 2)
Lengths of employment on entry, graduation, and 6/12/18 months later (Goal SII 3)
Disposable income on entry, graduation, and 6/12/18 months later (Goal SII 4)
Access to healthcare on entry, graduation, and 6/12/18 months later (Goal SII 5)
Gallons of gasoline used on entry, graduation, and 6/12/18 months later (Goal SII 6)
Carbon emissions on entry, graduation, and 6/12/18 months later (Goal SII 7)
B. Implement Measurement Tools and Tracking System
1. Organizational-Health and Program-Performance Indicators
The data needed to make measurements of the organizational-health
and program-performance indicators will come from Bonnie CLAC
Cars™ and QuickBooks, and from information and inquiries tracked by
the Director of Measurement and Quality.
Wherever possible, the collection of the data needed to make measurements of the organizational-health and program-performance
indicators will be integrated into Bonnie CLAC’s organizational processes. These data will come primarily from Bonnie CLAC Cars™ and
QuickBooks, and will be tracked automatically within those systems. As
necessary, these applications will be modified to facilitate the collection,
storage, tracking, and reporting of the indicators.
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Other organizational-health and program-performance indicators will
be developed by the Director of Measurement and Quality, primarily for
those indicators that involve the tracking of milestones. The Director
will gather such milestone data periodically from the managers responsible for the relevant programs and enter it into a tracking spreadsheet.
All organizational-health and program-performance indicators will
be tracked and reported at district and/or national levels, as appropriate.
They will be compared to budgets or targets, and will be viewable/reportable by month, quarter, year, and prior year.
2. Social and Economic Impact Indicators
Securing the data needed to make measurements of the social and
economic indicators will require baseline data from intake interviews,
as well as surveys and/or interviews of alumni upon graduation, and
6, 12, and 18 months later. The surveys and/or interviews will be the
responsibility of each alumnus’ Client Consultant. The survey/interview data will be sent to the Director of Measurement and Quality for
processing. The indicators will be tracked in a spreadsheet that will be
designed for this purpose by the Director of Measurement and Quality.
The Director will also create the dashboard needed for the feedback
loop (see Section C below).
Social and economic impact indicators will be tracked and reported
at the national level on a semi-annual basis by the Director of Measurement and Quality.
C. Implement Feedback and Self-Evaluation
1. Organizational-Health and Program-Performance Indicators
Bonnie CLAC will implement a process developed by the Director
of Measurement and Quality to analyze the data for each of its organizational-health and program-performance indicators regularly and to
apply such data to future decision making. On a monthly basis, The
Director of Measurement and Quality will analyze these indicators and
publish them as dashboards.
The dashboards will be designed by the Director of Measurement and
Quality with the advice and consent of the Senior Management Team,
They will be created for the district and national levels (with regionlevel summaries, if needed). Their form will depend on the nature of the
data being reported, the ability of the organization’s systems to produce
reports in a final format, and the preferences of the Senior Management
team. The dashboards might be simple spreadsheets; or, if management
preferred, they could employ graphical images to enhance their display
and use.
The CEO will review the district dashboards with his/her team and
then with each Regional Director. The Regional Director (and possibly
the CEO) will then review the district dashboards with each of that
region’s District Directors. Finally, each District Director will review relevant indicators with that District’s Client Consultants.
The CEO will also review the national dashboard with Senior Management and other relevant national staff members.
The focus of all of these reviews will be to determine any issues and
remedial actions required.
As appropriate, dashboards will include the following information:
Goal
Responsible individual
Indicator
Direction of change (>, <, =)
Baseline
Target
On an annual basis, the Director of Measurement and Quality will
include relevant organizational-health and program-performance indicators in a report card of indicators to share with external stakeholders.
2. Social and Economic Impact Indicators
On a semi-annual basis, the Director of Measurement and Quality will analyze social and economic impact indicators and publish a
dashboard (see Bonnie CLAC Appendix 23). Senior Management will
review this dashboard to assess Bonnie CLAC’s progress in achieving
its social and economic goals. At these meetings, Senior Management
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will determine any issues and remedial actions required. Senior Management will also revisit Bonnie CLAC’s Social Impact Model based on
these indicators.
On an annual basis, the Director of Measurement and Quality will
include relevant social and economic impact indicators in a report card
of indicators to share with external stakeholders.
X. PUBLIC POLICY
Phase I Goal: Develop focused initiatives to support state and federal public policies that further the organization’s mission and vision.
In Phase I, Bonnie CLAC will take a more proactive role in shaping
public policy to support its mission and vision. According to the Stanford Social Innovation Review, high-impact nonprofits need to combine
direct service programs with advocacy to reinforce and enhance their
impact over time.81 “High-impact organizations may start out providing
great programs, but they eventually realize that they cannot achieve
large-scale social change through service delivery alone.” To have the
greatest, long-term impact, Bonnie CLAC will focus on driving systematic change in the following four policy areas:
A. Transportation Individual Development Accounts (TIDA)
In recent years, Individual Development Accounts (IDAs) have become popular as an asset-building strategy for low-income individuals.
IDAs are income-eligible savings accounts that are matched anywhere
from a 1:1 to a 4:1 ratio from a combination of private and public sources.82 The funds can be used for one of three purposes: i) education for
the individual and/or children, ii) business capital, or iii) the purchase
or repair of a home. Bonnie CLAC is in the early stages of developing
a Transportation IDA (TIDA) to allow low-income individuals to save
money toward the purchase of a new, reliable car.
81 McLeod Grant, Heather and Leslie R. Crutchfield (Fall 2007). “Creating High-Impact
Nonprofits,” Stanford Social Innovation Review, 5(3): 35. http://www.ssireview.org
82 http://www.hud.gov/offices/pih/programs/hcv/wtw/ppp/learning/nhFss.cfm
B. Temporary Assistance for Needy Families (TANF)
TANF was established in 1997 to provide assistance and work opportunities to needy families by granting states the federal funds and wide
flexibility to develop and implement their own welfare programs. Citizens may apply for assistance at their local TANF agency. In the state of
New Hampshire, TANF currently has an administrative regulation that
prohibits TANF recipients from using their assistance to purchase cars
worth more than $4000. Bonnie CLAC has begun work to change this
regulation, so that TANF recipients can use their assistance to make
down payments on new cars that are more reliable and cost efficient in
the long run.
C. One-Time Earned Income Tax Credit (EITC)
The Earned Income Tax Credit (EITC), sometimes called the
Earned Income Credit (EIC), is a refundable federal income tax credit
for low-income working individuals and families. Bonnie CLAC is exploring the development of a one-time earned income tax credit to
be used towards the purchase of a reliable, affordable car through a
nonprofit organization.
D. Form Alliances
In Phase I, Bonnie CLAC will form alliances with government agencies, foundations, and other nonprofit organizations to focus on the
most promising efforts to impact the organization’s mission and vision.
Bonnie CLAC will also conduct further research to identify additional
public policy initiatives that could support its mission and vision.
Bonnie CLAC hopes to effect systematic change as it works toward
the long-term goal that one day, very low to moderate income people
will have broadly-available educational opportunities, a selection of
reliable and affordable cars, and a variety of financing mechanisms to
support the purchase of a car, all leading to improvements in their lives
and to the environment.
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XI. RISKS & EXTERNALITIES
Below are the four major risks associated with Bonnie CLAC’s growth
expansion and the steps Bonnie CLAC will take to mitigate them.
A. Hiring
As Bonnie CLAC expands, it will take intensive time and effort to recruit and hire the right executive for each national, regional, and district
position. Excellent team-building dynamics will be crucial in executing
the business plan in Phase I and longer term.
Mitigation: A search committee headed by Co-founder and Board
Director Leo Hamill, and including both Bonnie CLAC’s current President and Executive Director, has already been formed to find the CEO.
B. Focus
Bonnie CLAC will expand its operations using the criteria outlined in
this business plan. Bonnie CLAC will focus on the mission, vision, and
social outcomes stated herein, being careful to avoid mission creep and
the distraction of focusing on too many social factors.
Mitigation: This business plan provides a detailed guide for Bonnie
CLAC’s expansion. The appendix section also provides more detail
for immediate actions over the next six months in the form of a stepby-step action plan. If Bonnie CLAC carefully adheres to the action
and business plans, it will be able to maintain its focus and accomplish
its goals.
C. Marketing
Being able to find the right (target) clients and complete the required
number of car transactions is crucial as each district office scales and
moves toward profitability.
Mitigation: The business plan includes a robust marketing plan to
be carried out by a dynamic Chief Marketing Officer. Marketing tests
are already being conducted to determine the best course of action for
Phase I.
D. Fundraising
Bonnie CLAC will need to raise nearly $12.3 million over the next
five years to execute its business plan strategy.
Mitigation: Bonnie CLAC President Robert Chambers has already
obtained almost $1.2 million in committed funds and nearly $1.0 million in likely funds from local, national, and government sources.
XII. ACTION PLAN
To begin implementation of Phase I, Bonnie CLAC will accomplish the
following tasks outlined in the October 2007–March 2008 action plan:
ACTION PLAN (OCTOBER 2007-MARCH 2008)
Goal: To begin implementation of Phase I of the business plan,
Bonnie CLAC will:
I) Organize and Strengthen the New Hampshire District
Reach marketing targets (See Appendix 24)
Re-organize New Hampshire District to emulate ‘district model’
Re-organize New Hampshire District P & L to emulate ‘district financial
model’ in b-plan and reach revenue and expense target
Begin testing of all three BRIDGE options
II) Prepare National Operations
Re-align positions between national and districts to start to emulate
business plan
Hire CEO
Re-organize National P & L to emulate what is in the B-Plan and reach
revenue and expense targets for 3 consecutive months
Develope action plan near completion of current action plan
Assess current team’s time allocation and consider hiring additional support (i.e. PT development manager, contract CFO)
Target and begin meetings with primary target funders
III) Begin measurement and quality reporting system of NH District
indicators that allows for feedback loop
Develop and execute monthly reporting system on some national indicators that allows for feedback loop
IV) Secure partnerships
Secure 1 corporate partnership to ‘test’ Bonnie CLAC value added in NH
Secure 1 partnership to test ‘rent a wreck’ option for BRIDGE cars in NH
V) Determine Best Area to Launch New District
Work with MIT Sloan team to develop district model roll-out plan
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APPENDICES
Appendix 1—Bonnie CLAC Recognition and Awards
Awarded:
The Purpose Prize
The Manhattan Institute Award for Social Entrepreneurship
Media Coverage:
Time Magazine
Business Week
The Wall Street Journal
The Washington Post
The Annie E. Casey Foundation newsletter
Major Donations and Grants from:
The Byrne Foundation
Community Development Finance Authority
The Great Bay Foundation
New Hampshire Charitable Foundation
Norwin S. and Elizabeth N. Bean Foundation
United Way of the Greater Seacoast
Contributions from:
The Annie E. Casey Foundation
Chicago Soft, Ltd.
Chittenden Bank
Citizens Bank
Hanover Rotary Club
Hypertherm Incorporated
Johnson & Dix Fuel Corporation
King Arthur Flour
Ledyard National Bank
Mascoma Savings Bank
McLaughry Associates Inc.
The Mountain
Northeast Credit Union
Ocean National Bank
Page Hill Foundation
Tele Atlas
The Vermont Community Foundation
The Women’s Fund of New Hampshire
Town of Hanover
United Way of Merrimack County
United Way of the Upper Valley
Appendix 2—Client Testimonials
Meet Robyn
Robyn had a job making $10 an hour while raising two little girls on
her own. She had enough money to make a monthly car payment, and
she hoped to take out a loan for a car. But Robyn had bad credit from a
combination of credit card debt and a divorce. She was driving a 1993
Jeep that she had purchased for cash. The Jeep broke down frequently,
and Robyn was about to lose her job because of tardiness and absences
from work. Robyn was offered a loan at 25% interest rate on a 1999
Dodge Intrepid with 84,000 miles at a payment of $268 per month.
Robyn was about to buy this car. Then she heard about Bonnie
CLAC.
When Robyn came to Bonnie CLAC, her expenses were analyzed by
a Client Consultant. She was spending $277 per month on gas. If Robin
drove a new fuel-efficient Toyota Corolla, her gasoline costs would drop
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to $104, a savings of $173 per month. She was also spending over $120
per month on car repairs. These unbudgeted repairs contributed to her
credit card debt and caused her many absences from work.
After attending Financial Literacy, working on her budget, and repairing some credit items, Robyn was able to buy a new base model
Toyota Corolla at a 6.4% interest rate with the help of Bonnie CLAC.
Her car payment was $285 a month. This new car will still have five
years of life after Robyn has finished paying for it. Until she found Bonnie CLAC, Robin did not have the information, negotiating skills, or
access to credit necessary to make this purchase on her own.
Robyn cried when she got her new car because she was so excited.
Robyn’s credit has been restored, and she is now saving to buy a house,
a lifelong dream that owning a reliable car helped to make possible.
Meet Jackie
Jackie worked 60 hours a week at three different part-time jobs while
raising three young children on her own. She had enough money to
make a monthly car payment, and she hoped to take out a loan for a
car. But Jackie’s credit was destroyed when her husband left her and
her credit suffered during a divorce; she did not qualify for a loan and
subsequently bought an old car for $2,000 cash.
In a month, the engine failed and Jackie had to walk to work. She
spent $2,000 from her tax refund and her savings to replace the engine.
Six months after that, the car’s transmission died and Jackie traded in
her car for $500 and bought a used car with a loan at a 25% interest
rate. Six months later, it too broke down. Without a car, Jackie still had
to make payments on her loan, and she walked to work two miles each
way, often at night, until she found Bonnie CLAC.
With the help of the Financial Fitness classes, Jackie learned how to
budget, manage her credit, take care of personal finances, and negotiate
health care plans and car buying. When she felt ready, Bonnie CLAC
guaranteed her low-interest loan for a new Honda Civic with a five-year
bumper-to-bumper warranty. Jackie’s payments were only $276 a month
for the fuel-efficient, low-depreciating, reliable vehicle. Within two
months of buying her new Honda Civic, Jackie found a higher paying
job with health benefits. In addition, Jackie’s credit score is now good
enough that she is considering buying a house, something she says she
never would have been able to do without Bonnie CLAC’s assistance.
Appendix 3—Districts and Offices
New Hampshire District
Lebanon, NH
Keene, NH
Manchester/Concord, NH
Portsmouth/Exeter, NH
Appendix 4—Bonnie CLAC Pipeline Process
1. Recruiting
Bonnie CLAC recruits prospects from the very low to moderate income community. Local offices work with social service agencies to find
prospective clients, partner with and make local company presentations,
and distribute flyers to spread the word about Bonnie CLAC.
2a. Screening I:
After an initial inquiry comes in, Bonnie CLAC’s Intake Manager
uses a short, telephone-based survey to determine whether the prospect
has at least $300 in disposable income after paying monthly expenses.
This screening process helps ensure that those who come in for a Client
Consultant interview have a good chance of enrolling and succeeding in
the Bonnie CLAC program.
2b. Screening II:
Prospects who are approved over the telephone are invited to come
to a local site and meet personally with a Client Consultant. They are
asked to bring income and expense statements with them so the consultant can verify whether they have sufficient disposable income to
meet monthly car, insurance, and gas payments. The goal of this meeting is to ascertain financial qualifications and to help prospects better
understand the program so they can decide whether or not to enroll.
Prospects who choose to enroll pay a $65 fee and become official Bonnie
CLAC clients.
3. FastTrack or Counseling:
As soon as a client enters the program, the enrolling Client Consultant becomes his/her counselor. The Client Consultant works with
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the client to develop a customized plan that fits the client’s personal
financial status and situation. Clients with good to excellent credit records, stable employment, and residence history may enter FastTrack
and receive a new car almost immediately. Otherwise, clients begin
an intensive counseling program that includes credit repair, Financial
Fitness (FinFit) classes, and other needed assignments required by the
individual’s profile.
Credit Repair
Client Consultants perform one-on-one credit analysis to determine
the credit counseling appropriate for each client. The customized cleanup plan is based on the client’s credit history and his/her ability to make
payments to creditors. Clients whose accounts are in collection can take
6-12 months to improve their credit history. During this time, Client
Consultants will give clients “assignments” toward credit repair and
(re)establishment of a positive payment history.
» Credit repair assignments may include paying charged-off
loans, making plans to pay all regular monthly expenses (rent,
utilities, loans, etc.) on time, explaining medical charge-offs,
and identifying fraud or errors and correcting them.
» (Re)establishment of a positive payment history may include
the creation of a savings plan and/or enrollment in Bonnie
CLAC’s transitional BRIDGE car program.
During the savings plan, clients are required to deposit
$250-$285 per month into a savings account, with the purpose of demonstrating their ability to build this recurring
“expense” into their budget.
The BRIDGE program provides clients who need a
“bridge” loaner car with one at a cost of only $250 a
month. At the same time, clients improve their credit records by building a history of on-time, monthly payments.
The BRIDGE Manager places clients into this program,
lines up the necessary BRIDGE cars for them, collects
monthly payments, and conducts a review after two to
three months. The BRIDGE Manager also helps transition
BRIDGE clients into the next step of the program once
their credit records have been sufficiently repaired.
Financial Fitness (FinFit)
Financial Fitness (FinFit) is a five-week financial literacy program
taught by a Bonnie CLAC FinFit Instructor. FinFit classes include
budgeting and financial goal setting, checking-account management,
money-saving techniques, protecting and building a positive credit history, and food economics and nutrition. Food economics and nutrition
is included as a topic of Financial Fitness because Bonnie CLAC strives
to help clients make economic shopping choices and improve health
outcomes. Financial Fitness teaches clients to make sustainable changes
in all aspects of their lives by encouraging personal growth related to
self-worth and status, long-term planning and thinking, and the development of a healthy relationship to money.
4. Vehicle Selection:
The client and Client Consultant work together to select a vehicle that
is appropriate for the client’s budget, family size, and other needs. This
selection is usually a Toyota Corolla or a Honda Civic, although other
vehicles may be purchased with the approval of the Client Consultant.
Bonnie CLAC’s focus is on financing fuel-efficient cars. This goal helps
combat fuel emissions and pollution even as it puts more very low to moderate income drivers on the road. Once a vehicle has been selected, the
Client Consultant asks the Delivery Manager to locate the vehicle.
5. Financing a Car:
Upon completing the program and selecting a car, the client is now
ready to purchase the car. The Client Consultant collects the following information in order to advocate for the client in his/her loan
application.
Client’s length of time with Bonnie CLAC
Programs completed with Bonnie CLAC (Credit Repair, Savings
Plan, BRIDGE Program, Financial Fitness)
Time at job
Time at residence
Current vehicle/transportation source
Average weekly commute to work
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Explanation of credit issues
Bonnie CLAC enables its clients to obtain wholesale financing rates
for their new car loans through partnerships with financial institutions.
Bonnie CLAC acts as guarantor for the car loan. Interest rates average around 6.8%, which is exceptionally low for this particular client
base.83 Once the loan is submitted and approved by the financial institution, Bonnie CLAC’s Delivery Manager completes the purchase
and sale documentation and the bank loan paperwork necessary for the
purchase of the new car. Clients sign a lease for a five-year loan, with
monthly payments of $250-$285. Each client also pays a one-time loan
guarantor’s fee of $800 to Bonnie CLAC for financing and providing
support throughout the duration of the loan. This $800 is built into the
terms of the loan instead of coming directly out of the client’s pocket.
6. Delivery of a New Car:
When the loan has been funded and the money has been paid to the
car dealership, the Delivery Coordinator either accompanies the client
to the local dealership to pick up the new car, or arranges for the local
car dealership to drop it off.
7. Alumni Support:
Once Bonnie CLAC clients receive their new cars, they are known as
Bonnie CLAC alumni. Bonnie CLAC alumni are contacted periodically
by Client Consultants for follow-up and monitoring throughout the life
of the car loan. This includes information or assistance with:
Maintenance, repairs, warranties, and/or extended warranties
Disputes with insurance companies over unfair claim decisions
Communications with the financial institution regarding car
loans
Ongoing financial fitness support and education
Discounts on new and used auto parts
Preparations for future car purchases
83 Vogel, John H. Jr. (Marc 2005). “Bonnie CLAC Case Study.” Tucker School of Business
at Darmouth: 4.
Appendix 5—Social Impact Model
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Appendix 6—Training Manual (Removed for Publication)
Bonnie CLAC Training Manual
Appendix 7—Selecting a District Site
Bonnie CLAC’s district site selection will be guided by the following
household, funder, and partner criteria.
I. State
A. Determine which states within each region have the highest
number of very low to moderate income households.
(See Table H)
B. Determine which states have the greatest fundraising capability.
C. Determine which states have the greatest partnership support
and potential.
II. City
In locating the district office within a qualifying state, Bonnie CLAC
will use the following process:
A. Use the US Department of Housing and Urban Development (HUD)
guidelines and the US Census to determine the cities that have very low to
moderate income populations of 120,000 households or more.
1. Use the US Census to obtain the median household income for all metropolitan statistical areas (MSAs) in a
given state. http://factfinder.census.gov/servlet/ADPGeoS
earchByListServlet?ds_name=ACS_2005_EST_G00_&_
lang=en&_ts=200697026088
2. Use HUD guidelines (0–30% of the area median income
= very low; 30–50% of the area median income = low;
50–80% of the area median income = moderate) and the
US Census to calculate the total number of very low to
moderate income households in all of the metropolitan
statistical areas (MSAs) in that state.
3. Identify the MSAs with at least 120,000 very low to moderate income households.
4. Because MSAs are usually calculated using a radius of 25
miles or less, it will often be necessary to pull additional
data in order to qualify potential district sites. To do so:
a. Identify the central zip code of the MSA.
b. Locate zip codes within X miles of the central zip
code, using (www.zip-code.com/zip-code-radiusfinder.asp).
c. Use the US Decennial Census to obtain the median
household income for each zip code. http://factfinder.
census.gov/servlet/DatasetMainPageServlet?_
program=DEC&_submenuId=&_lang=en&_ts=
d. Use HUD guidelines (0–30% of the area median
income = very low; 30–50% of the area median income = low; 50–80% of the area median income
= moderate) and the US Decennial Census to calculate the total number of very low to moderate
income households in each zip code.
B. Determine which districts have the greatest fundraising capability. At a minimum, a district office must be able to raise $75,000
in start-up philanthropic funds to launch and an additional
$50,000 in the next 18 months.
C. Determine which districts have the greatest partnership support
and potential. Each district office must be supported by:
1. Two or three social service and nonprofit referral agencies
2. Two or three corporations that hire or serve a population
fitting Bonnie CLAC’s target profile
3. At least one organization that can teach high-quality financial fitness classes
4. At least one organization willing to provide in-kind office
facilities for a start-up staff for the next two years
5. One financing bank (if necessary)
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D. Other criteria, such as distance to and from public transportation, centrality of location, or political considerations, may be
taken into account at the discretion of the Regional Director
and CEO.
Hampshire Third Party Evaluation Preliminary Interview Guide
Sample Interview Questions
Former Bonnie CLAC Participants (N=20)
1. How did you learn about Bonnie CLAC?
2. How did you become involved with Bonnie CLAC’s programs?
3. Describe your involvement from the point of enrollment to a new
car purchase.
4. Are there any aspects of your life that have changed since your
participation in Bonnie CLAC’s program?
Prods:
Employment status
Occupation
Job training/education
Community involvement
Child’s schooling/activities
Health care (doctor/dental visits)
Income
Public assistance
Credit
Other
5. Do you know what your credit score was when you started the
program?
6. What contributed to your credit status before participating in the
program?
Prods:
Credit card debt (any portion medical bills?)
Medical debt
Student loan debt
Other debt
Bankruptcy
Foreclosure
Unbanked status
Other
Don’t know
7. How much has your participation in Bonnie CLAC’s financial
classes helped you manage your finances?
Prods:
Debt
Banked status
Reallocation of finances; investment behavior
Other
8. How much has your purchase of a new car through Bonnie
CLAC helped with your economic position?
9. Would you change any aspects of the program? Please elaborate.
10. We would really like to see if your credit score has changed since
your car loan through Bonnie CLAC. If we work with Bonnie
CLAC to cover the cost of acquiring your score (it costs around
$25), would you be willing to help us get your credit score?
The next questions are not as tied to your participation in the Bonnie CLAC program as the previous questions, but are interesting to us
because adequate transportation might have implications for accessing
health care, which is an important and timely topic given rising health
care costs.
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1. Are you, your spouse, and child(ren) covered by a health insurance plan?
2. Please describe the source(s) of your health insurance.
Prods:
Employer sponsored
Other private plan
Medicaid
Government
Military
Other
3. Have you ever struggled to afford your health insurance plan?
Please elaborate.
4. Have you ever struggled with medical bills? Please describe.
5. Have actual medical bills ever impacted your finances?
Prods:
Credit card usage
Amount of savings
Home purchase
Educational attainment
Ability to acquire loans
Other investments
6. Has the threat of medical bills ever impacted your financial decisions?
7. Have actual medical bills ever impacted your employment?
Prods:
Bills prevented R from getting needed health care, which hurt
ability to work
Work multiple jobs to afford medical bills
Other
8. Has the threat of medical bills ever impacted your employment
decisions?
Prods:
Stayed in current job to ensure continuation of benefits
Left current job for insufficiency of benefits
Other
Hampshire Third Party Evaluation Preliminary Interview
Results
Bonnie CLAC Interview Analysis
Carsey Institute
Fall 2007
Because of the sensitive nature of the questions being asked as part
of the Bonnie CLAC Outcomes Research, the first step in the multimethod approach was to conduct interviews with a small sample of
participants (N=13). This allowed the research team to learn about
participants’ experiences and perceptions regarding the program, which
could then be used to inform the design of a survey instrument, to be
sent to approximately 200 former Bonnie CLAC participants.
Following are a number of tables summarizing the responses from
the interviews. It is important to keep in mind that only 13 observations were made. The distribution of answers may provide a sense of
this sample’s experiences but is not representative of all Bonnie CLAC
participants. The value provided by the interviews was that the research
team was able to put these answers in context based on other factors
shared by respondents. Examples will be provided.
According to Table 1, most participants were either referred to Bonnie CLAC through an agency/nonprofit or by a friend, co-worker or
family member (word of mouth).
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Table 1. How Participant Became Involved with the Bonnie CLAC Program
How respondent
heard of Bonnie CLAC
Freq.
Percent
Cum.
agency/org/nonprofit
4
30.77
30.77
word of mouth
5
38.46
69.23
newspaper/print
1
7.69
76.92
counselor
2
15.38
92.31
car dealership
1
7.69
100.00
Total
13
100.00
One factor that emerged in the interviews that might be strongly
related to whether or not a participant experiences economic changes
in his/her life, especially in the short-term, is whether or not the participant had a car prior to joining the program. While “peace of mind”
was frequently sited (see Table 4) as a benefit of the program, some
participants who already had a car, albeit an unreliable car, experienced
no immediate changes other than a reduction in fear about breaking
down; however, they did hope that the overall experience would lead to
an improvement in their credit over the long-term. Table 2 reveals that
a large majority of those interviewed had cars prior to the program.
Table 2. Whether or Not Participants Had a Vehicle Prior to the Program
The Respondent’s
car situation
Freq.
Percent
Cum.
no car
4
30.77
30.77
unreliable car
9
69.23
100.00
Total
13
100.00
As might be expected, almost all of the participants interviewed struggled with credit and/or a lack of income, which led to their participation
in the program. A factor that emerged from these answers as something
for consideration includes reasons for bankruptcy. For instance, one respondent had filed due to divorce. The respondent claimed that she
had no credit cards, but that she inherited part of her ex-spouse’s debt,
which for her was “inconceivable”. From this participant’s standpoint,
a change in credit score may be her biggest goal and job changes would
not apply. Another respondent had filed due to an investment in a business venture, which he did on the side of his steady job. After utilizing
credit cards to fund his investment, the respondent found himself consumed in debt. Again, this respondent’s income and job are unlikely
to change, but there is still potential for an impact, especially with his
credit score over the long-term.
These examples reveal that in some cases, participants may not show
impacts in certain areas despite dire circumstances at the onset but that
impacts could occur in other areas. Two interviewees who cited bankruptcy as a factor described how the program affected them in ways that
are not tied to job changes. These interviews suggest the importance of
looking at a range of outcomes of the program.
Table 3. Reason Why Participant Needed Bonnie CLAC’s Help
The reason the respondent
needed Bonnie CLAC
Freq.
Percent
Cum.
no/poor credit and low income
5
38.46
38.46
poor credit
3
23.08
61.54
bankruptcy
4
30.77
92.31
100.00
wanted guidance
1
7.69
Total
13
100.00
When asked about what changes respondents experienced after the
program, peace of mind was cited repeatedly. This of course, may be a
function of the large proportion of people in this sample who had an
unreliable car prior to going through the program. Other respondents
mentioned multiple positive changes as indicated in Table 4. One factor that emerged from these answers is the role that age may play in a
participant’s experiences.
A participant that experienced positive changes in her job and her
living situation admitted that the changes were due to the fact that
she was graduating from college and moving out of her parent’s home
for the first time. Her participation in the program coincided with these
milestone events. This is not to say that the program did not help her in
numerous ways — she had a lot of debt and needed guidance — but that
without this knowledge, one might assume that her job and living changes resulted from the program as opposed to her personal development.
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Table 4. Positive Changes Experienced After the Bonnie CLAC Program
Freq.
Percent
Cum.
peace of mind
4
36.36
36.36
job performance
2
18.18
54.55
budget, transport fam, & invest
1
9.09
63.64
Changes experienced by the
respondent after the program
peace of mind, job, & invest
1
9.09
72.73
peace of mind, job, & transport fam
1
9.09
81.82
budget, job, & invest
1
9.09
90.91
budget, job, & transport fam
1
9.09
90.91
Total
11
100.00
Interviewees were asked about suggestions for improvement, summarized in the last table. Regardless of these suggestions, every single
respondent had positive feelings about the Bonnie CLAC program and
seemed grateful for the experience. Several respondents mentioned referring other friends and family and some said they had purchased more
than one car through Bonnie CLAC. When asked how Bonnie CLAC
could improve its services, respondents shared suggestions listed in Table 5. Some individuals had to really think about an answer, but one
suggestion that 3 participants felt strongly about was that there should
be more car options.
Table 5. Suggestions for Improving Bonnie CLAC’s Services
Freq.
Percent
Cum.
no suggestion
3
3.08
23.08
provide follow up
2
15.38
38.46
more car options
3
23.08
61.54
make loaner cars cheaper
1
7.69
69.23
reduce fee
2
15.38
84.62
fix paperwork issues
1
7.69
92.31
more assistance with credit
1
7.69
100.00
Total
13
100.00
Suggestions for improvement
to the program
Summary
Based on the preliminary interviews, it is obvious that while many
participants share a status of poor credit and/or a lack of income, their
situations vary tremendously. Some individuals admitted to struggling
persistently, while others had been hit more recently. Participants also
shared gratitude toward Bonnie CLAC, and multiple respondents said
something to the extent of having no idea what they would have done
without Bonnie CLAC’s assistance.
The interviews provided insight into what factors might be important
for the survey design but also for analyzing the survey data. There are
certainly instances when what appear to be impacts might be something
else like personal development and other instances when a lack of observable impacts in one area does not necessarily mean the participant
was not affected in other ways.
Hampshire Third Party Evaluation Final Survey Instrument
This survey will provide important information about Bonnie CLAC
and how it helps clients. Your participation is completely voluntary. You
will receive a $10 gift card along with your current credit score once we
receive the signed release and completed survey.
Please fill this out now and return the survey and signed release form
in the self-addressed, stamped envelope. This survey is important for
Bonnie CLAC. Please accept our sincere thanks.
Please circle the number of your response or fill in the blank. Thank
you!
Your Situation Before Bonnie CLAC
1. Which of the following describes your situation before you went
through Bonnie CLAC?
1. I did not have a car
2. I had an unreliable car
3. My family needed a second car
4. Other _______________________________________
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2. What are the reasons that you went through Bonnie CLAC (circle
all that apply)?
1. Poor credit
2. Needed a bridge car
3. Needed budget/financial counseling
4. Wanted assistance working with a car dealer
5. Needed assurance that I could afford car payments
6. Had no money to put down
7. Other _______________________________________
Changes Since Participating In The Bonnie CLAC Program
3. Which of the following activities have you been able to do as a result
of completing the Bonnie CLAC program (circle all that apply)?
1. Finding a job
2. Getting to my job
3. Going to health/dental care appointments
4. Having more options for food
5. Having more options for health care
6. Participating in schooling/training programs
7. Transporting family members
8. Attending child’s activities (sporting events, plays, etc.)
9. Accessing day care
10. Attending community events
11. Shopping/running errands
12. Other ________________________________________
4. Going through the Bonnie CLAC program has helped me accomplish the following job changes (circle all that apply):
1. I found a new job
2. I found a better job
3. I found a better paying job
4. I can work a steady schedule
5. I arrive on time for work
6. I have received a pay increase in my current job (hourly
wage increase of: $_________)
7. I work more hours per week (approximately _____ more
hours per week)
8. I receive better benefits (health insurance, retirement, life
insurance, etc.)
9. Other ________________________________________
10. No changes in my job situation due to Bonnie CLAC
5. Due to your participation in Bonnie CLAC’s program how has your
spending changed (circle all that apply)?
1. I spend less on gas for my car
2. I spend less on insurance for my car
3. I spend less on repairs for my car
4. I spend less on interest rates
5. I am more careful about my purchases
6. I am more likely to pay bills on time
7. I have less pressure from creditors
8. Other ________________________________________
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6. How has your overall financial situation changed since you purchased your car? Is it
1. much better
2. somewhat better
3. no different
4. worse
7. Due to your experience with Bonnie CLAC, which of the following aspects of your overall financial situation have changed (circle
all that apply)?
1. I have more money at the end of each month (approximately $_______ more per month)
2. I am better able to pay my bills
3. I put money into my savings account
4. I put money towards a rainy day fund and/or a reserve for
emergencies
5. I am saving to buy a home
6. I am investing in a small business
7. I am investing in a retirement account
8. I am able to afford better recreational activities
9. I have been able to put money aside for education
10. I am able to afford more nutritious food
11. Other (please explain)___________________________
8. Do you currently have health insurance?
1. yes 2. no
9. Did you have health insurance before your experience with Bonnie CLAC?
1. yes 2. no
Your Feelings About Bonnie CLAC
10. Please rate your overall experience with Bonnie CLAC
1. excellent 2. good 3. fair 4. poor
11. If a friend or relative needed a new car, would you recommend
that they work with Bonnie CLAC to obtain a new car?
1. Definitely yes 2. Maybe 3. Definitely no
Please explain: ____________________________________
____________________________________
12. During your experience with Bonnie CLAC, what three things
were the most important to you?
1. Access to a bridge car
2. Financial literacy class
3. Consulting services
4. Help with the car loan
5. Knowledge about the car industry
6. Knowledge about how to find and keep a job
7. Other, please specify ____________________________
13. Is there anything else you would like to tell us about your experience with Bonnie CLAC?
Finally, Some Questions About You and Your Background
14. Are you male or female?
1. Male 2. Female
15. What is your age? _______ years old
16. What is your marital status?
1. married
2. single
3. divorced/separated
4. other
17. How many children do you have under the age of 19?_______
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18. How far did you go in school?
1. Less than high school
2. High school diploma or GED
3. Some college
4. Associate’s Degree
5. Bachelor’s Degree
6. Graduate/Professional Degree
7. Other_____________________
19. Are you currently employed?
1. yes 2. no
If you are willing to be interviewed by a researcher of health insurance at UNH, about your experiences with medical bills, please provide
your first name and number. If you are not willing, leave it blank.
First name _______________________________________________
Preferred Number _________________________________________
THANK YOU FOR COMPLETING THIS SURVEY. WE WILL SEND
YOUR $10 GIFT CARD AND YOUR CREDIT SCORE WITHIN A
FEW DAYS OF RECEIVING THE COMPLETED SURVEY AND RELEASE FORM.
PLEASE RETURN THIS SURVEY AND THE SIGNED RELEASE
IN THE ENCLOSED SELF-ADDRESSED, STAMPED ENVELOPE.
THANK YOU!
Appendix 11—Biographies of Board of Directors and
Advisory Board
Merilynn Bourne; Cornish, NH (advisory member)
Executive Director of LISTEN Community Services; extensive background in administration, marketing and personnel management with
many years of retail experience; living in Cornish, NH; member of the
Finance Committee, the PTO, the Cornish Fair Association; and Assistant Town Moderator for five years.
Mary Burnett; Hinsdale, NH
Executive Director of Bonnie CLAC; 28 years experience in retail car
industry as Dealer Principal; ongoing Volunteer Instructor for the Bonnie CLAC Financial Fitness program, as well as periodic guest speaker
at community and educational events.
Robert Chambers; Hanover, NH
President and Co-Founder of Bonnie CLAC; Major Gifts Development Officer with Dartmouth-Hitchcock Medical Center; E-Commerce
Manager, Miller Automobile; fundraiser for River Valley Club; President
and founder of Computer Software Company in New York, NY; Vice
President Sales Dartmouth subsidiary, DTSS Inc. Robert worked as an
auto salesman for four years and became ever more disillusioned with
how low-income individuals were treated when they purchased a car.
These individuals were frequently sold older cars because they were
more profitable to the dealers, at high interest rates and with terms
that the buyer did not understand. The culminating experience came
when Robert saw the sales person and the business manager celebrate
with a “high-five” when they completed a sale to a vulnerable low-income single mother. The sale resulted in a $5,000 profit. Robert decided
something had to change; so began Bonnie CLAC.
Allan Ferguson; Meriden, NH
Robert E. Field, Sr.; Hanover, NH
Retired Deputy Chairman, Price Waterhouse; Trustee Dartmouth
College; Treasurer of Dartmouth College; Chairman Board of Overseers
Tuck School of Business; Trustee and Chairman of Dartmouth-Hitchcock Medical Center; Named Fiduciary of the JP Morgan Chase Bank
Employee Benefits Plans.
Beth Ann Finlay; Northfield, VT (advisory member)
Executive Director of Northern Vermont Research Conservation and
Development Council.
Leo Hamill, Jr.; Hanover, NH
Co-Founder of Bonnie CLAC; Vice President, Sales, Miller Automobile; General Sales Manager, Miller Nissan Jeep; Superintendent of
Highways, Town of Hanover; Projects Manager Northland Real Estate
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168
Development Co.; Director of Public Works, Bridgeton, ME.; Member
of the Hanover Lions Club for 12 years.
Robert G. Hansen; Hanover, NH
Senior Associate Dean and Norman W. Martin 1925 Professor of
Business Administration at the Tuck School of Business at Dartmouth
College, where he has been on the faculty since 1983. Professor Hansen
oversees academic areas of the Tuck School, including faculty recruiting, promotion, and research matters.
David Reeves; Norwich, VT
Ph.D. from Harvard University; a private investor in the financial
markets; Professor, McCormick Theological Seminary in Chicago, locally active in school and nonprofit organizations.
Judith Richard; Concord, NH
Judith has over 30 years of experience in corporate real estate and
more than seven years experience in the New Hampshire real estate
market. She holds degrees in Accounting and Marketing from Franklin Pierce College and a Masters Certificate in Human Resources from
Southern NH University Graduate School of Business. Judith is the 2006
president of the Women’s Council of Realtors and the recipient of the
2006 Realtor Member of the Year Award from the Central NH Women’s
Council of Realtors and the Women’s Council of Realtors, State of New
Hampshire. In addition, she is the Vice President of Administration for
the Silverstein Organization.
Chandra L. Ribiero; West Lebanon, NH. (Bonnie CLAC Client
Representative)
Rick Sayles, CPA, CFA, CFP; Hanover, NH
Owner of a financial consulting business. Active in several non-profit
organizations. Background experience at Price Waterhouse and Prudential Insurance.
Appendix 12—Chief Executive Officer Job Description
Bonnie CLAC is a 501(c) (3) founded in 2001. Bonnie CLAC’s
mission is: to help low and moderate-income individuals buy new fuel
efficient vehicles. Bonnie CLAC provides a partial guarantee of the
loans, extensive counseling services and teaches a Financial Literacy
Course that helps clients to become successful and economically selfsufficient. Bonnie CLAC has received a grant to expand our program
and services into three additional states in New England. We are also
working on a strategic business plan for a National Expansion. For more
information, please visit www.bonnieclac.org, or Contact:
Robert Chambers, President (603) 727-7006.
Position:
Bonnie CLAC has been growing steadily and is now seeking to dramatically accelerate its growth. The Board and President are looking for
a mission-focused, seasoned, strategic, and process-minded leader with
experience scaling an organization, leading an executive management
team, and developing a performance culture among a group of diverse,
talented individuals. The CEO must be a leader who is able to help others at the Organization deliver measurable, cost-effective results that
make the vision a reality. Importantly, the successful CEO will have the
skills, sensitivity, and personal confidence to tap into the power that
each member of the team brings to this mission. While it is essential that
the CEO bring efficient and effective systems to increase the productivity of the Organization, is it also critical that the team retain the creative
spark that drives the BONNIE CLAC concept and vision.
Responsibilities
Working in partnership with the President of Bonnie CLAC, the
CEO will lead all internal operations and will have the following responsibilities:
In partnership with the President, implement the strategic five-year
plan and implement new processes and approaches to successfully
achieve it.
Serve as the internal leader of the organization:
» Coordinate the annual operations plan and budget
» Lead the performance management process that measures and
evaluates progress against goals for the organization
169
170
» Provide for all staff a strong day-to-day leadership presence;
bridge national and regional operations and support an opendoor policy among all staff
Hire, lead and manage the organization’s senior level managers who
have the following responsibilities:
» New site development
Raise local funds
Build local fund raising communications and Client Consulting infrastructures within local offices
Generate sufficient local revenue to cover local costs
Identify geographic growth opportunities and priorities
Communicate the branded message internally and externally
» Program
Increase key impact measurements
Ensure that all programmatic partners renew their contracts
Develop curriculum, tools, and training that meet cost
guidelines
Bonnie CLAC currently has four fully operational offices in New
Hampshire and will open eight additional offices in four New England
States over the next two years.
Key Qualifications
As a prerequisite, the successful candidate must believe in the core
values of BONNIE CLAC and be driven by the mission. The candidate
should demonstrate a passion for breaking new ground to lead social
change. Beyond that, we are seeking a candidate that has proven experience in scaling a multi-site organization and a demonstrated ability to
both lead and build the capabilities of a driven, bright, diverse team.
The successful candidate will most likely have had management experience with a for-profit organization. As noted, this is an organization
driven by the values of its people, so experience in managing a “valuesdriven” organization will be highly prized. Additional requirements are:
Results—proven track record of exceeding goals and a bottom-line
orientation; evidence of the ability to make good decisions through
a combination of analysis, wisdom, experience, and judgment; high
level of business acumen, including successful P&L management
and the ability to balance the delivery of programs against the realities of a budget; problem solving, project management, and creative
resourcefulness
Strategic Vision and Agility—ability to think strategically, anticipate
future consequences and trends, and incorporate them into the
organizational plan
Capacity Building—ability to effectively build organization and staff
capacity, developing a top-notch workforce and the processes that
ensure the organization runs smoothly
Leadership and Organization—exceptional capacity for managing
and leading people; a team builder who has experience in scaling
up organizations; ability to connect staff both on an individual level
and in large groups; capacity to enforce accountability, develop and
empower top-notch leaders from the bottom up, lead from the top
down, cultivate entrepreneurship, and learn the strengths and weaknesses of the team so as to put people in a position to succeed
Action Oriented—enjoys working hard and looks for challenges;
able to act and react as necessary, even if limited information is
available; not afraid to take charge of a situation; can overcome
resistance to leadership and take unpopular stands when necessary
General Management—thorough understanding of finance, systems,
and HR; broad experience with the full range of business functions and systems, including strategic development and planning,
budgeting, business analysis, finance, information systems, human
resources, and marketing
Solid Educational Background—undergraduate degree required;
MBA or similar advanced degree highly desired
171
172
Compensation
This is an outstanding opportunity for a highly motivated professional to assume a pivotal role in the evolution of a fast-growing, highly
respected organization. We are seeking an individual of outstanding
quality with a respected track record. Bonnie CLAC is prepared to
offer a very attractive compensation package, including a competitive
base salary.
Appendix 13—Bonnie CLAC Cars™ System Functions
Bonnie CLAC Cars™ performs the following functions:
Inbound client call management
Initial telephone profile intake and client registration
Financial fitness course registration
Counseling session logging
Appointment and class scheduling
BRIDGE car recordkeeping
Donation acceptance
Correspondence creation and tracking
Car dealer relations
Loan processing, including preparation and storage of loan documentation
Title transfers
Summarizing and reviewing operational activities
Appendix 14—Marketing Road Map
(Removed for Publication)
Appendix 15—Bonnie CLAC Alumni Membership Program
Objective: Bonnie CLAC will maintain ongoing relationships with
clients and enhance their connection to the organization by offering
valuable car-related services and continued assistance with financial
and car-related matters. In return, Bonnie CLAC will solicit referrals
from alumni members and consider the charge of a small annual fee to
cover the Client Consultant salary.
Potential Benefits:
Newsletter
Alerts regarding scams
Financial and other tips
Ongoing educational opportunities
Roadside assistance through AAA partner
Other discounts and coupons
Support group
Social events
Potential Payment Options
Additional $5 a month on loan
Annual membership fee
Sponsorship underwritten by AAA, financial institutions, insurance agencies, etc.
Appendix 16—Sample Promotional Flyer
173
174
Appendix 17—Corporate Partnership Package
Bonnie CLAC will develop partnerships with corporations that fit the
following profile:
1. A significant number (> 50%) of the company’s employees qualify
as low wage workers.
2. The company is large enough (usually > 60 employees) to have a
full-time human resources coordinator.
3. The company is growing or experiencing employee turnover. It
might also be experiencing problems with recruitment.
4. The company offers employee benefits.
5. The company requires travel as part of the job for some of its employees.
Bonnie CLAC will test the use of the Corporate Partnership Package
with its corporate partners. This package consists of:
Paycheck stuffers
Break room posters
Newsletter article series to be placed in the company newsletter
Lunch-and-learn presentations, including a DVD with the Bonnie CLAC PBS segment
Appendix 18—Target Partnerships
CURRENT PARTNERSHIPS
Targeted local
small businesses
Irving Oil
FUTURE PARTNERSHIPS
Local small businesses
mom & pop tire shops
repair shops
gas stations
day cares
hair dressers
women’s gyms
Social service agencies
ACORN
Social service agencies
JobCorps
Aids Project of Southern VT
Housing coalitions
ALANA Community Services
Alice Peck Day Community
Hospital
American Red Cross
Area Agency on Aging
CATCH
Cheshire Housing Trust
CCCS
Families in Transition
Good Beginnings
Good New Garage
Granite State Independent
Living
HCRS
Keene Housing
Listen
MCRC
Michael’s House
Micro Credit of NH
Monadnock Development
Services
NH Employ Security
NH Minority Health Coalition
Service link
SEVCA
SCS
Upper Valley Ride Share
Corporations
Hypertherm
Health organizations
Dartmouth-Hitchcock Medical
Center
Corporations
See profile in Appendix 17
Health organizations
Northern New England LEADS
Institute
175
176
The Edgewood Centre
Endowment for Health
Hospitals
Nursing homes
Health care agencies
Nonprofits/universities
Nonprofits/universities
United Way
United Way
Tuck Business School
SCORE
Business schools and universities
throughout the country
Adult education institutes
Local car dealerships
National car manufacturers
Toyota of Keene
Honda
Honda of Keene
Toyota
Subaru of Keene
Car rental companies
Fairfield’s Motors
Enterprise
Berlin City Auto
Avis
Autex of Keene
Budget
Gerrish Motors
Alamo
National
Dollar
Thrifty
Hertz
Rent-a-Wreck
Chittenden Bank
Citizens Bank
Northeast Credit Union
Bank of America
Chase Manhattan Bank
Citibank
Local & national news media
PBS
Local & national news media
To be determined
BusinessWeek
Time
The Wall Street Journal
The Washington Post
Government agencies
Government agencies
State of New Hampshire
Local agencies
CDFA
State agencies
Federal agencies
Funding organizations
Funding organizations
The Annie E. Casey
Foundation
Robert Wood Johnson Foundation
The Great Bay Foundation
Jane’s Trust
The Endowment for Health
Skoll Foundation
N.H. Charitable Fund
Bean Foundation
Betterment Fund
177
178
Targeted Philanthropic Organizations
Local Foundations
New Hampshire Charitable Fund
Endowment for Health
Neil & Louise Tillotson Foundation
Betterment Fund (Maine)
Government
Federal Government Earmark
Appendix 19—Committed and Targeted Philanthropy
Appendix 20—National Financial Model and Notes
Appendix 21—District Start-up Financial Model and Notes
Appendix 22—New Hampshire District Model and Notes
Appendix 23—Social and Economic Indicator Dashboard
A Practical Guide to Business Planning for Enduring Social Impact
Imagine a day when organizations whose primary mission is social impact — nonprofits,
government agencies, and for-profit enterprises alike — use business plans as their road
maps to facilitate the rapid generation of successful and lasting solutions to a wide variety of
social problems, including poverty, domestic violence, unequal access to health care, and the
achievement gap in education.
Imagine a day when funders use these business plans to make investment decisions, track progress,
and inform further decisions about reinvestment — ultimately directing capital logically and
predictably to the organizations that demonstrate the best performance and impact.
Business Planning for Enduring Social Impact applies the strategic rigor and financial savvy of
traditional private-sector business planning to social problem solving. This practical guide provides
an introduction to business planning for enduring social impact and leads readers through a fourstep process for creating an actionable business plan.
The guide is an essential tool for organizations seeking to:
• Define organizational focus and strategy and establish a clear road map
• Build a financially sustainable model by creating a plan to establish reliable streams of
philanthropic support, earned income, and/or in-kind resources
• Establish rigorous methods of measuring impact for the organization and its stakeholders
• Make data-driven decisions that lead to improvements to the organization and its activities
• Build partnerships with stakeholders in all three sectors — public, private, and nonprofit
Business Planning for Enduring Social Impact draws on Root Cause’s unique business planning
methodology, developed through consulting engagements with dozens of organizations, and
through experience with the social enterprises that Root Cause has started and grown. The
guide is the first in a series of Root Cause How-to Guides, which provide practical advice
for organizations in the public, private, and nonprofit sectors dedicated to solving social
problems.
Root Cause is a nonprofit organization that advances enduring solutions to social and
economic problems by supporting social innovators and educating social impact investors.
Our purpose is to generate enduring solutions to social problems. Root Cause envisions a
world in which the public, private, and nonprofit sectors work together to invest and reinvest
in the most efficient, effective, and sustainable solutions to social problems, regardless of
organizational structure, ego, or political agenda.
© 2008 Root Cause
675 Massachusetts Avenue, 9th floor
Cambridge, MA 02139
(617) 492-2300
[email protected]
www.rootcause.org
Price: $19.95
ISBN 978-0-615-18284-1
90000 >
9 780615 182841

Document 6488078

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